Question

A decreasing-cost industry will have Group of answer choices a perfectly elastic long-run supply curve. a perfectly inelastic long-run supply curve. an upward sloping demand curve in the long run. a downward sloping supply curve in the long run.

Answer 1

Answer: a downward sloping supply curve in the long run

Explanation:

In a DECREASING COST industry, producing more output leads to a reduction in costs associated.

Graphically represented then, in the long run when output have Increased, the supply curve will be DOWNWARD sloping as it costs LESS to make MORE.

I have attached a graph to explain further.

As you see, more output means less price so the Supply Curve is sloping downward.