An increase in the input prices of the firm leads to ________.

The correct answer is Option 4: all of above

When input prices increase (e.g., raw materials, wages, rent), the cost of production rises, which affects multiple cost-related curves in the firm.

1️⃣ Upward Shift of the Marginal Cost (MC) Curve ✅

• MC represents the additional cost of producing one more unit.
• Higher input prices mean each additional unit now costs more to produce, causing the MC curve to shift upwards.

2️⃣ Leftward Shift of the Supply Curve ✅

• Since production becomes more expensive, firms reduce the quantity supplied at each price level.
• This results in a leftward shift in the supply curve, indicating less supply at the same price.

3️⃣ Increase in Average Cost (AC) ✅

• Average Cost (AC) = Total Cost / Quantity
• Higher input prices increase Total Cost (TC), leading to an increase in AC at all levels of output.