Assuming the question means that production cost is much reduced, and that demand does not change, then the supply curve moves to the right, resulting in a lower equilibrium price.
See, for example, graph 1 of
http://www.econport.org/content/handbook/Equilibrium/shifts-graph.html
If there was a baby boom of Oompa Loompas ready to work for free, what will happen to the Willy Wonka chocolate market? In particular: Has this affected supply or demand of Willy Wonka Chocolate? What has happened to the price of Willy Wonka chocolate? Please describe the graph of your answer by change in either supply or demand, as well as the change in price
1 answer
2 answers