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If Input Prices Rise as Industry Output Expands, What Will

Question 124

Multiple Choice

If input prices rise as industry output expands, what will happen to a perfectly competitive firm's marginal cost and average cost curves?


A) They will not shift; as the firm increases production, however, costs decrease as the firm moves downward to the left along these curves.
B) They will not shift; as the firm increases production, however, costs increase as the firm moves upward to the right along these curves.
C) They will shift downward.
D) They will shift upward.

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