Assume that all firms in this industry have identical cost curves, and that the market is perfectly competitive. If the market supply curve is given by S3, then what will happen to the market supply curve in the long run?
A)It will stay at S3, but the quantity supplied will increase.
B)It will shift to S2.
C)It will shift to S1.
D)It will stay at S3, but the quantity supplied will decrease.

Question

Assume that all firms in this industry have identical cost curves, and that the market is perfectly competitive.  If the market supply curve is given by S3, then what will happen to the market supply curve in the long run?
A)It will stay at S3, but the quantity supplied will increase. 
B)It will shift to S2. 
C)It will shift to S1. 
D)It will stay at S3, but the quantity supplied will decrease.

Quizplus · Accepted Answer

The Answer of Assume that all firms in this industry have identical cost curves, and that the market is perfectly competitive.  If the market supply curve is given by S3, then what will happen to the market supply curve in the long run?
A)It will stay at S3, but the quantity supplied will increase. 
B)It will shift to S2. 
C)It will shift to S1. 
D)It will stay at S3, but the quantity supplied will decrease.

Assume That All Firms in This Industry Have Identical Cost