The Joy of Understanding Supply Curve Shifts and Movements

What does a rightward shift in the supply curve indicate?

a) Increase in total supply
b) Decrease in total supply
c) Changes in quantity demanded

Answer:

a) Increase in total supply

When the supply curve shifts to the right, it indicates an increase in the total supply of a certain commodity. This could be due to various factors such as improved production methods, lower production costs, or favorable changes in market conditions. The rightward shift signifies that producers are now willing and able to supply more of the commodity at each price point.