A fall in demand for a commodity in a perfectly competitive market will shift the long-run supply curve to the right.

Question

Quizplus · Accepted Answer

In a perfectly competitive market, a fall in demand for a commodity would lead to a decrease in price and quantity sold, potentially causing some firms to exit the market in the long run. This would decrease the overall market supply, not increase it, so the long-run supply curve would shift to the left, not the right.

A Fall in Demand for a Commodity in a Perfectly