The Long-Run Supply Curve Under Pure Competition Will Be

question 44

Multiple Choice

The long-run supply curve under pure competition will be

• A)downward-sloping in a decreasing-cost industry and upward-sloping in an increasing-cost industry.
• B)horizontal in a constant-cost industry and downward-sloping in an increasing-cost industry.
• C)vertical in a constant-cost industry and upward-sloping in a decreasing-cost industry.
• D)upward-sloping in an increasing-cost industry and vertical in a constant-cost industry.

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Definitions:

Market Value

The current monetary value assigned to buying or selling an asset or service in the open market.

Financing

The process of providing funds for business activities, making purchases, or investing, through various means such as loans, equity, bonds, or other financial instruments.

Growth Expectations

Growth expectations refer to the anticipated rate at which a company, sector, or economy is expected to grow in the future.

WACC

Weighted Average Cost of Capital; a calculation of a firm's cost of capital wherein each category of capital is proportionately weighted.