If, as a result of a change in demand in a perfectly competitive increasing-cost industry, price and quantity rise, demand must have risen

Question

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In a perfectly competitive increasing-cost industry, an increase in demand will lead to a rise in both price and quantity. This is because as demand increases, firms in the industry will need to increase production to meet the higher demand, causing the cost of production, including the cost of factors of production, to increase. As a result, the equilibrium price will increase as firms try to cover their higher costs, and the equilibrium quantity will also increase as firms try to meet the higher demand. Therefore, if both price and quantity are rising, demand must have also risen.

If, as a Result of a Change in Demand in a Perfectly