If resource prices rise and the average total cost of producing a product increases as the firms in an industry expand output in response to an increase in demand, the long-run market supply curve for the product will
A) be perfectly elastic (a horizontal line).
B) be perfectly inelastic (a vertical line).
C) slope upward to the right.
D) be more inelastic than the short-run supply curve for the product.

Question

Quizplus · Accepted Answer

When resource prices rise as firms expand output, the cost of production increases, leading to an upward-sloping long-run supply curve.

If Resource Prices Rise and the Average Total Cost of Producing