If the price of an input decreases, each individual firmʹs marginal cost curve shifts ________ and the industry supply curve ________.
A) downward; shifts to the left
B) downward; shifts to the right
C) up; does not change
D) up; shifts to the left

Question

Quizplus · Accepted Answer

When the price of an input decreases, it becomes cheaper for firms to produce goods, leading to a downward shift in the marginal cost curve for individual firms. This, in turn, allows firms to offer more at every price level, shifting the industry supply curve to the right.

If the Price of an Input Decreases, Each Individual Firmʹs