Entry of new firms in an increasing-cost industry leads to an upward shift of the LRAC curve.

Name: Entry of new firms in an increasing-cost industry leads to an upward shift of the LRAC curve.
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Question

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In an increasing-cost industry, as more firms enter the market, the prices of inputs tend to increase due to higher demand for these inputs, leading to an upward shift in the Long-Run Average Cost (LRAC) curve.

Entry of New Firms in an Increasing-Cost Industry Leads to an Upward