Question 32 What happens in an increasing cost industry in response to an increase in demand? firms exit and push costs downward until the new long run average cost curve's minimum point corresponds to the new, higher price. firms enter and push costs downward until the new long run average cost curve's minimum point corresponds to the new, lower price. firms starts to exit and output decreases until the price arrives at the new, higher price. firms enter and output increases until the price returns to its original level. firms enter and push costs upward until the new long run average cost curve's minimum point corresponds to the new, higher price.

Question 32 What happens in an increasing cost industry in response to an increase in demand? firms exit and push costs downward until the new long run average cost curve's minimum point corresponds to the new, higher price. firms enter and push costs downward until the new long run average cost curve's minimum point corresponds to the new, lower price. firms starts to exit and output decreases until the price arrives at the new, higher price. firms enter and output increases until the price returns to its original level. firms enter and push costs upward until the new long run average cost curve's minimum point corresponds to the new, higher price.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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