1 0 . As the output of an industry expands, in the short run, marginal costs will...
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1 0 . As the output of an industry expands, in the short run, marginal costs will increase, causing the short-run market supply curve to slope upward to the right. If cost conditions in the industry are unchanged as the market output is expanded, the long-run supply curve will be perfectly elastic. However, as the output of an industry expands, rising factor prices and industrial congestion will normally cause the firm's cost curves to shift upward. The long-run market supply curve for such an increasing cost industry will slope upward to the right.
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Economics Private And Public Choice
ISBN: 9780123110404
2nd Edition
Authors: James D Gwartney; Richard Stroup; A H Studenmund
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