Final answer:
When the cost of production decreases due to improved technology, there is an increase in supply. When resources are fixed, increasing the production of one good causes a decrease in production of the other.
Step-by-step explanation:
An improvement in technology that reduces the cost of production will cause an increase in supply. This is because when the cost of production decreases, firms are able to produce more of a good at a lower price, leading to an increase in supply. For example, if a farmer adopts new technology that allows them to produce more crops with less resources, they will be able to supply more crops to the market.
On the other hand, when resources are fixed and the production of one good increases, there will be a decrease in the production of the other good. This is because the fixed resources can only be allocated to a limited extent, and allocating more resources to one good means less resources are available for the production of the other good. For example, if a company decides to allocate more of its resources to produce more laptops, it will have fewer resources available to produce smartphones.