What is the graphical effect of technological change?
A)The SRAC curves would shift down and the LRAC curve would shift up.
B)The SRAC curves would shift up and the LRAC curve would shift down.
C)The SRAC curves and the LRAC curve would shift up.
D)The SRAC curves and the LRAC curve would shift down.

Question

Quizplus · Accepted Answer

Technological change typically increases efficiency, reducing the cost of production. This leads to both the Short-Run Average Cost (SRAC) curves and the Long-Run Average Cost (LRAC) curve shifting downwards, as it becomes cheaper to produce goods at any given level of output.

What Is the Graphical Effect of Technological Change