When a resource used in the production of a good sold in a competitive market is available in only limited quantities, the long-run supply curve is likely to be upward sloping.

Question

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In a competitive market, if a resource necessary for production is limited in supply, it can lead to increased costs as production expands, causing the long-run supply curve to slope upwards due to the scarcity of the resource driving up prices.

When a Resource Used in the Production of a Good