If the long-run supply curve in a perfectly competitive industry is downward-sloping, then the market is characterised by:
A) decreasing input costs.
B) increasing input costs.
C) increasing or decreasing input costs.
D) constant input costs.

Question

Quizplus · Accepted Answer

A downward-sloping long-run supply curve in a perfectly competitive industry suggests that as output increases, the cost of production per unit decreases, which is characteristic of decreasing input costs.

If the Long-Run Supply Curve in a Perfectly Competitive Industry