In supply analysis, an improvement in production technology for a good would, other things equal, shift which curve and in which direction?

Introduction / Context:
Technology is one of the key determinants of supply in microeconomics. When technology improves, firms can often produce the same output with fewer inputs or more output with the same inputs. Understanding how such changes affect supply and demand curves is fundamental for analysing market outcomes. The question asks how an improvement in technology affects the relevant curve, assuming other conditions remain constant.

Given Data / Assumptions:

• There is an improvement in production technology for a particular good.
• Input prices, number of sellers and other factors are assumed constant.
• We are using the standard supply and demand framework.
• We need to identify which curve shifts and in which direction.

Concept / Approach:
An improvement in technology generally means that firms become more efficient. They can produce more output from the same quantity of inputs, or produce a given output at a lower cost. In supply and demand terms, this is a change in supply conditions, not in demand. At each possible market price, firms are now willing and able to supply more units because their per unit cost has fallen. Graphically, the supply curve shifts to the right, which represents an increase in supply. The demand curve, which is driven by consumer preferences, incomes and prices of related goods, does not shift directly due to a change in production technology.

Step-by-Step Solution:
Step 1: Recognise that technology is a supply side factor because it affects how efficiently firms can produce goods.Step 2: Recall that improvements in technology reduce the cost of production or increase productivity.Step 3: Understand that lower costs or higher productivity make firms willing to supply more at each price level, which is shown as a rightward shift of the supply curve.Step 4: Conclude that the supply curve shifts rightward, and select that option as the correct answer.

Verification / Alternative check:
Consider a simple example. Suppose farmers adopt a new high yielding variety of wheat that allows them to grow more wheat per acre without increasing costs. At any given market price for wheat, each farmer can now supply more bags of wheat than before. As all farmers adopt this technology, the total quantity supplied at each price increases, shifting the industry supply curve to the right. The demand curve for wheat, based on consumers preferences and incomes, remains the same in the short run. The increased supply then tends to lower the equilibrium price and increase the equilibrium quantity in the market.

Why Other Options Are Wrong:
Option A is wrong because an improvement in production technology does not directly shift the demand curve; it affects supply. Option C is incorrect because technology improvements increase supply and thus shift the supply curve to the right, not to the left. Option D is also wrong because the demand curve shifts leftward when demand falls due to factors like lower income or changes in tastes, not when technology improves on the production side. Only option B correctly states that the supply curve shifts rightward in response to better technology.

Common Pitfalls:
Students sometimes confuse any rightward shift in a curve with an increase in demand, ignoring whether the shift is in the supply or demand curve. Another common mistake is to think that technology, because it is often associated with new products, must affect demand, when in fact the first impact is usually on the cost and productivity of production. For examination questions, it helps to remember a simple rule: better technology for producers shifts supply to the right, whereas changes in consumer factors such as income and tastes shift demand.

Final Answer:
An improvement in production technology increases supply and shifts the supply curve rightward, other things equal.