What Is the Shape of the Long-Run Industry Supply Curve

question 32

Multiple Choice

What is the shape of the long-run industry supply curve in a perfectly competitive industry largely determined by?

• A) the shape of the average fixed cost curve
• B) the price of inputs as the industry expands
• C) the shape of the short-run industry supply curve
• D) the price elasticity of market demand

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Definitions:

Uncertainty

The state of having limited knowledge where it is impossible to exactly describe existing states, outcomes, or future events.

Individual Mandate

A requirement for individuals to have health insurance or pay a penalty, originally a key provision of the Affordable Care Act.

Affordable Care Act

The Affordable Care Act, also known as Obamacare, is a law enacted to increase health insurance quality and affordability, and lower the uninsured rate by expanding public and private insurance coverage.

Adverse Selection

A situation where sellers have information that buyers do not have, or vice versa, leading to an unbalanced and inefficient market.