Consider a competitve market with a large number of identicalfirms. The firms in

Question

Consider a competitve market with a large number of identicalfirms. The firms in this market do not use any resources thatare available only in limited quantities. In this market, anincrease in demand will. a. increase price in the short run, but not in the longrun b.increase price in the long run, but not in the shortrun. c. increase price both in the short and the long run. d. not affect price in either the short or the long run. Consider a competitve market with a large number of identicalfirms. The firms in this market do not use any resources thatare available only in limited quantities. In this market, anincrease in demand will. a. increase price in the short run, but not in the longrun b.increase price in the long run, but not in the shortrun. c. increase price both in the short and the long run. d. not affect price in either the short or the long run.

Explanation / Answer

A. increase price in the short run , but not in the long run.

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