Part a) True or False: In a competetive market, a firm's short run supply curve is sloping upwards due to diminishing returns of the variable input. Explain why. Part b) Are long run supply curves always upward sloping? Explain why or why not with a graph.

Part a) True or False: In a competetive market, a firm's short run supply curve is sloping upwards due to diminishing returns of the variable input. Explain why. Part b) Are long run supply curves always upward sloping? Explain why or why not with a graph.

Economics (MindTap Course List)

13th Edition

ISBN:9781337617383

Author:Roger A. Arnold

Publisher:Roger A. Arnold

Chapter22: Perfect Competition

Section: Chapter Questions

Problem 2QP

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Accounting and Economic Profit analysis

One comes across the concept of Profits in the context of business and in analyzing the results of business activity. Profits of a business can be accounting profits, and they can also be economic profits. So how does one understand the concept of accounting versus economic profits?

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Answer both parts a and b please.

Part a) True or False: In a competetive market, a firm's short run supply curve is sloping upwards due to diminishing returns of the variable input. Explain why.

Part b) Are long run supply curves always upward sloping? Explain why or why not with a graph.

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