Assume that a decreasing-cost industry experiences an increase in demand. In the long run, this will

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In a decreasing-cost industry, an increase in demand leads to an increase in production, which results in a larger scale of production and lower average costs. This, in turn, leads to a decrease in prices in the long run. Therefore, an increase in demand in a decreasing-cost industry leads to a price decrease.

Assume That a Decreasing-Cost Industry Experiences an Increase in Demand