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Suppose the market for plain white t-shirts is perfectly competitive and in long-run equilibrium. Now suppose the demand for plain white t-shirts increases. When the market for plain white t-shirts reaches a new long-run equilibrium, how will the market compare to the market before the increase in demand

Sagot :

In the new long-run equilibrium, there would be an increase in the number of suppliers of t-shirts.

What would happen when the demand for plan white t-shirts increase?

A perfect competition is when there are many buyers and sellers of homogenous goods and services. Market prices are set by the forces of demand and supply.

When demand for t-shirts increase, there would be an excess of demand over supply. This would lead to a shortage. This would increase the price of t-shirts. In the long run, more suppliers would enter into the industry and this would increase supply of t-shirts. As a result, equilibrium would be restored.

To learn more about perfect competition, please check: https://brainly.com/question/17110476

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