If the long-run supply curve slopes downward, we know that this is

Question

Quizplus · Accepted Answer

If the long-run supply curve slopes downward, it means that as the industry expands, the cost of production falls. This implies that the industry can achieve economies of scale, as it grows in size. A decreasing-cost industry is one in which new firms can enter the market without leading to an increase in production costs for all firms, due to factors such as improved technology, better access to resources, or increased bargaining power with suppliers. Therefore, choice (A) is the best answer.

If the Long-Run Supply Curve Slopes Downward, We Know That