Suppose a purely competitive, increasing-cost industry is in long-run equilibrium. Now assume that a decrease in consumer demand occurs. After all resulting adjustments have been completed, the new equilibrium price ____________.

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Answer:

Purely Competitive Market

Explanation:

P=AR=MR=MC

where P, is Price

where AR, is Average Price

where MR, is Marginal Revenue

where MC, is Marginal Cost.

In a purely competitive market, a decrease in consumer demand leaves price to be unchanged . Hence, after ALL resulting adjustments have been completed, the new equilibrium price is the same, and does not change.