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The entry of new firms decreases the average production costs for existing firms.
As new firms enter the market, the demand for scarce resources increases, leading to higher operational costs.
A leftward shift in the supply curve due to firm exits can lead to an increase in market prices.
Increasing cost industries are characterized by constant production costs regardless of market entry.
Higher wages resulting from increased demand for labor can affect the pricing strategy of firms.
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Increasing Cost Industries
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