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AP® Microeconomics

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Perfectly Competitive Market: Short-Run to Long-Run Change

APMICR-X0GYJL

The graphs below represent a perfectly competitive market and a typical firm in that market.

Jane Schaefer. Created for Albert.io. Copyright 2016. All rights reserved.

Based on the graphs above, what will happen in this industry in the long-run?

A

Supply in the industry will increase, equilibrium price in the industry will increase and demand for the firm will decrease.

B

Supply in the industry will decrease, equilibrium price in the industry will increase and demand for the firm will increase.

C

Supply in the industry will decrease, equilibrium price in the industry will decrease and demand for the firm will decrease.

D

Demand in the industry will increase, equilibrium price in the industry will increase and demand for the firm will increase.

E

Demand in the industry will decrease, equilibrium price in the industry will decrease and demand for the firm will decrease.