In an increasing cost industry:

Name: In an increasing cost industry:
Brand: Quizplus
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Question

Quizplus · Accepted Answer

In an increasing cost industry, the costs of production increase as the industry output increases. This is because as the demand for inputs (such as labor, materials, and energy) increases, their prices also increase, making production more expensive. This leads to a higher minimum efficient scale and a rising long-run average cost curve, which in turn leads to higher prices and lower output in the long run.

In an Increasing Cost Industry