Which statement is correct? The long-run supply curve for a purely competitive
A) decreasing-cost industry will be upward-sloping.
B) increasing-cost industry will be perfectly elastic.
C) increasing-cost industry will be upward-sloping.
D) increasing-cost industry will be less elastic than the short-run supply curve.

Question

Quizplus · Accepted Answer

In an increasing-cost industry, the long-run supply curve will be upward-sloping. This is because as demand for the product increases, firms will need to use less efficient production methods, causing costs to increase and leading to higher prices in the long run. The long-run supply curve will be less elastic than the short-run supply curve because in the long run, firms have more time to adjust their production methods and inputs, making it more difficult to increase output quickly without incurring higher costs.

Which Statement Is Correct? the Long-Run Supply Curve for a Purely