Under What Conditions Would an Increase in Demand Lead to a Lower

question 130

Multiple Choice

Under what conditions would an increase in demand lead to a lower long-run equilibrium price?

• A) The firms in the market are part of a decreasing-cost industry.
• B) The firms in the market produce an inferior good.
• C) Potential new firms in the market are not attracted by economic profits.
• D) Increases in demand cannot lead to lower long-run equilibrium prices.

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