Which statement is false?
A)In the market period,industry supply is either perfectly inelastic or very inelastic.
B)In the short run,an increase in demand cannot lead to an increase in a firm's output.
C)If an increase in demand is considered to be long lasting,new firms will tend to enter the industry.
D)Supply is most elastic in the long run.

Question

Quizplus · Accepted Answer

In the short run, an increase in demand can lead to an increase in a firm's output, but only up to a certain point where the firm's fixed inputs are fully utilized. Beyond that point, the firm would need to invest in additional fixed inputs to further increase its output, which would take time and therefore fall into the long run.

Which Statement Is False