After an increase in demand in a constant-cost industry,the long-run average cost curves of firms shift upward.

Question

Quizplus · Accepted Answer

In a constant-cost industry, the long-run average cost curves of firms remain the same even after an increase in demand. This is because the industry has access to the same resources and inputs at the same cost, so there is no upward pressure on costs. Therefore, the cost curves do not shift upward.

After an Increase in Demand in a Constant-Cost Industry,the Long-Run