Under what conditions would an increase in demand lead to a lower long-run equilibrium price?

A) The firms in the market are part of a decreasing-cost industry.
B) The firms in the market produce an inferior good.
C) Potential new firms in the market are not attracted by economic profits.
D) Increases in demand cannot lead to lower long-run equilibrium prices.

Decreasing-cost Industry

An industry where the cost per unit of output decreases as the scale of production increases.

Long-run Equilibrium Price

The price level at which the quantity supplied equals the quantity demanded, achieved over a period where all inputs can be varied by producers.

Increase in Demand

A situation where there is a rise in consumers' desire to purchase goods or services, leading to higher quantity demanded at every price level.