In the Long Run, the Supply Curve for a Perfectly

question 32

Multiple Choice

In the long run, the supply curve for a perfectly competitive industry:

• A) will shift to the right if new firms enter the industry.
• B) is the sum of all individual firms' average total cost curves.
• C) is horizontal at the market price.
• D) is the same as the marginal cost curve over all levels of output.

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Definitions:

Total Benefits

The complete set of advantages, monetary or otherwise, received from the consumption or use of a good or service.

Textile Industry

A sector of the economy focused on the production of yarn, cloth, and clothing, and the various processes involved in the manufacture of textiles.

Economic Policy

Strategies and decisions made by governments and central banks to influence the economy, including fiscal policy, monetary policy, and regulatory measures.

Producers Better Off

A condition where producers experience an improvement in profitability or market position, often due to increased demand or reductions in costs.