Assume That All Firms in This Industry Have Identical Cost

question 73

Multiple Choice

Assume that all firms in this industry have identical cost curves, and that the market is perfectly competitive. If the market supply curve is given by S3, then what will happen to the market supply curve in the long run?

• A)It will stay at S3, but the quantity supplied will increase.
• B)It will shift to S2.
• C)It will shift to S1.
• D)It will stay at S3, but the quantity supplied will decrease.

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Definitions:

Primary Data

Data collected firsthand for a specific research purpose, involving direct interaction with the study subjects through surveys, interviews, or experiments.

Time-Consuming

Requiring a significant amount of time to complete, often more than what is considered desirable or efficient.

Costly

Involving great expense; something that requires a high amount of money or resources.

Specific Firm

Refers to a particular company or business entity mentioned or focused upon in a discussion.