What is the relationship between the long-run industry supply curve and the short-run supply curve in a perfectly competitive market?
What will be an ideal response?
The long-run industry supply curve evolves from the short-run supply curve. As new firms enter, the short-run supply curve shifts toward its long-run position. Also, as short-run fixed cost commitments become variable, the short-run cost curves become the long-run cost curve.
Economics
You might also like to view...
Which of the following will cause a direct increase in consumption spending?
A) a decrease in net export spending B) an increase in planned investment C) an increase in disposable income D) an increase in government spending
Economics
Analyze the following statement "the global financial crisis of 2008-2009 was a great illustration of how interdependent national economies are."
What will be an ideal response?
Economics