Which of the Following Best Describes How a Perfectly Competitive

Multiple Choice

Which of the following best describes how a perfectly competitive industry would respond to a sudden increase in popularity of the product? The market demand curve would shift to the right, leading to:

A) a higher equilibrium price in the short run and entry into the market in the long run.
B) a higher equilibrium price in the short run and a permanent increase in economic profit.
C) no change in the short-run equilibrium price, and a higher long-run equilibrium quantity.
D) a lower short-run equilibrium price due to the entry of firms into the market.