Q22. In perfectly competitive constant-cost industries and perfectly competitive increasing-cost industries, respectively, what is the most likely long-run effect of a permanent increase in demand?

Constant-cost industry                    Increasing-cost industry

A,  price decreases                             price decreases

B.  price decreases                           price remains unchanged

C,  price remains unchanged                     price decreases

D.  price remains unchanged                   price remains unchanged

答案和详解如下：

Q22.     C      Study Session4-18.f

In the case of constant-cost industries, the long-run supply curve is perfectly elastic or horizontal Therefore, a permanent increase in demand would have no effect on the price in the long run. In the case of an increasing-cost industry, the long-run supply curve slopes upward and a permanent increase in demand would result in an increase in the price.

c

thx

请指教。