If Input Prices for Perfectly Competitive Firms Increase as the Output

question 163

Multiple Choice

If input prices for perfectly competitive firms increase as the output of its industry expands:

• A) their short run average cost curves will shift up as the industry expands.
• B) after a permanent increase in demand, the long run equilibrium price will be higher than the original price.
• C) after a permanent increase in demand, the short run equilibrium price will be higher than the eventual long run equilibrium price.
• D) all of the above will be true.

---

Definitions:

Profession Tone

A style of communication that is formal, courteous, and appropriate for a professional setting, reflecting respect and competence.

Buffer

A neutral or positive statement used at the beginning of a message to cushion the impact of negative news or feedback.

Indirect Format

A communication method where the main point is not stated directly at the beginning but is hinted at or revealed through the course of the message.

Negative Message

Communication that conveys bad news, rejections, or unfavorable decisions, often requiring careful wording to maintain goodwill.