The long-run supply curve in a constant-cost industry is linear and:
A) upward-sloping.
B) downward-sloping.
C) horizontal.
D) vertical.
E) could have any constant slope.

Question

Quizplus · Accepted Answer

In a constant-cost industry, the long-run supply curve is horizontal as increases in demand do not affect the cost of production for firms. Therefore, they can increase output without facing higher costs, resulting in a flat and constant supply curve.

The Long-Run Supply Curve in a Constant-Cost Industry Is Linear