The Cost Of Producing Flat-Screen Tvs Has Fallen

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The Cost Of Producing Flat-Screen Tvs Has Fallen

over the past decade. Let's consider some implications of this fact. a. Draw a supply-and-demand diagram to show the effect of falling production costs on the price and quantity of flat-screen TVs sold. 4pts
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The effect of falling production costs in the market for flat-screen TVs results in a shift to the right in the supply curve, as shown in Figure 11. As a result, the equilibrium price of flat-screen TVs declines and the equilibrium quantity increases.

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