In a perfectly competitive industry, the equilibrium price is $56 and the minimum average total cost of the industry's firms is $40. If this is a constant-cost industry, we can expect that in the long run, firms will _____ the market, shifting the industry's short-run supply curve _____.

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In a constant-cost industry, when firms are making a profit (price > minimum average total cost), new firms will enter the market. This increases supply, shifting the supply curve outward, and drives the price down until it equals the minimum average total cost, which in this case is $40. This process continues until firms are earning zero economic profit, which is a characteristic of long-run equilibrium in perfectly competitive markets.

In a Perfectly Competitive Industry, the Equilibrium Price Is $56