Assume that a constant-cost, perfectly competitive market is initially in long-run equilibrium. After all long-run adjustments are made, which of the following would occur as a result of an increase in the price of a complement to this industry's product?

a. The market price would remain unchanged; the market quantity would rise.
b. The market price would rise; the market quantity would fall.
c. The market price would remain unchanged; the market quantity would fall.
d. Both the market price and the market quantity would fall.
e. Both the market price and the market quantity would rise.


C

Economics

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