Question

State three factors that can cause a rightward shift of the supply curve of a commodity.

What factors cause a rightward shift of the supply curve?

Answer 1

A rightward shift of the supply curve means an increase in the supply of a commodity at every price level. This can happen due to several factors.

1. A fall in the cost of production, such as lower prices of raw materials or cheaper labour, makes it easier for producers to supply more.
2. Technological improvements help in producing goods more efficiently and in larger quantities.
3. Government subsidies reduce the cost burden on producers, encouraging them to increase supply. These factors make it more profitable for producers to supply more goods, leading to a rightward shift of the supply curve.