With increasing returns (falling average costs), as the remaining
Firms expand, their demand curves become _______________
Due to foreign competition, and firms must _______________.
A)steeper; raise prices
B)flatter; lower prices
C)flatter; raise prices
D)steeper; lower prices

Question

Quizplus · Accepted Answer

With increasing returns and falling average costs, firms can produce more efficiently, leading to flatter demand curves. Due to foreign competition, firms must lower prices to remain competitive.

With Increasing Returns (Falling Average Costs), as the Remaining