Assume That There Is an Outward Shift in the Demand

Multiple Choice

Assume that there is an outward shift in the demand for chairs.Which of the following best describes the short-run response within the competitive market for chairs?

A) Existing firms and new firms will expand output by using more of all inputs.
B) Existing firms will keep fixed inputs unchanged and expand output using the variable inputs.
C) Existing firms will increase their profits by producing the same output at a higher price.
D) Existing firms cannot increase production in the short-run so the price of chairs will increase.