Which of the following events would result in an increase in supply in a market?

• A. A decrease in the number of sellers in the market
• B. A government-imposed tax on the product
• C. A technological advancement that lowers production costs
• D. An increase in the price of inputs used in production

Answer: (C)

Verified step by step guidance

1. Understand the concept of supply: Supply refers to the quantity of a good or service that producers are willing and able to sell at different prices over a period of time.
2. Recall that an increase in supply means that producers are willing to sell more of the good at every price, which shifts the supply curve to the right.
3. Analyze each event in terms of its effect on production costs and willingness to sell: - A decrease in the number of sellers reduces total market supply. - A government-imposed tax increases production costs, typically reducing supply. - A technological advancement that lowers production costs makes it cheaper to produce, encouraging producers to supply more. - An increase in the price of inputs raises production costs, usually decreasing supply.
4. Identify which event lowers production costs or otherwise incentivizes producers to supply more: the technological advancement that lowers production costs fits this criterion.
5. Conclude that the event resulting in an increase in supply is the technological advancement that lowers production costs, as it shifts the supply curve to the right.