The short-run supply curve of a firm operating in a perfect competition market is equal to the marginal cost (MC) curve remaining on the average variable cost (AVC) curve of the firm in question. Explain the reason for this with the help of the figure.

Q: When a perfectly competitive firm is at the profit maximizing output level what will be the…

A: Perfectly competitive market: In a perfectly competitive market structure there exists a large…

Q: Perfect competition occurs when none of the individual market participants (buyers and sellers) can…

A: A market is the collection of buyers and sellers. Perfect competition is the market form with a…

Q: In perfect competition, firms set price equal to marginal cost. Why can’t firms do this when there…

A: In the perfectly competitive market, firms are the price takers as they produce identical product…

Q: The graph below shows a perfectly competitive firm in short run equilibrium, where the firm has…

A: Ans) The correct option is - a) price will decrease until economic profit is zero.

Q: What is the short-run Shutdown condition for a perfectly competitive firm?   P>AVCminimum…

A: In a market, a shutdown point refers to the point at which a firm is unable to recover its operating…

Q: The shut-down point for a competitive firm is in the short run is where

A: In the short run the shut-down point for a competitive firm is in the is where the average…

Q: A perfectly competitive firm that is maximizing profits will experience which of the following price…

A: Perfect competitive market has large number of buyers and sellers, has free entry and exit of firms…

Q: The graph shows the marginal cost (MC), average total cost (ATC), and marginal revenue (MR) curves…

A: # a competitive firm produces output where P=MC. At this P=MC, from the given figure it is easy to…

Q: Show and explain how the short run supply curve of the perfectly competitive firm is derived.

A: in a perfectly competitive market there are large number of firms producing similar and identical…

Q: You are a manager in a perfectly competitive market. The price in your market is $14. Your total…

A: Profits are the excess of revenue receipts earned by the firms over the costs incurred in the…

Q: Given the following short run production cost schedule:   Short Run Total Cost Function…

A: Marginal cost is the additional cost incurred on the production of one extra unit of the output. In…

Q: If the price of a product produced by a perfectly competitive firm falls below the average total…

A: Perfect competition refers to the situation where there are many buyers and sellers exist in the…

Q: Under the assumption of perfect competition in short run firms only earn abnormal profit.…

A: The statement is false.

Q: For the following, decide whether you agree or dis-agree and explain your answer: a. A firm earning…

A: A perfect competition is the form of market that consist of large number of buyers and sellers,…

Q: A perfectly competitive firm faces the short-run cost schedule shown in Table 1.

A: Perfect competition is the market structure where there are large no of buyers and sellers selling…

Q: Can an industry characterized by globally increasing returns to scale be perfectly competitive in…

A: 3.1Long-run equilibrium in a scenario of a perfectly competitive industry is said to have occurred…

Q: Since a perfectly competitive firm can sell as much as it wishes at the market price, why can the…

A: A perfect competition(PC) market is one with many buyers and sellers producing identical products.…

Q: Identify a perfectly competitive firm that you have purchased a good or service from in the last…

A:

Q: Given the following short run production cost schedule:   Short Run Total Cost Function…

A: The above given is a case of a firm under perfect competition. The equilibrium condition is P= AR=…

Q: Which of the following is NOT necessarily true about the long-run equilibrium of a perfectly…

A: A perfectly competitive firm is a price taker and choses the level of output where marginal cost…

Q: the perfectly competitive market, the average total cost of the small business owner will be: A)2 B)…

A: Equilibrium under perfect competition is at price = MC level MC insects the pice at 23 units  At Q =…

Q: The graph depicts the average total cost curve for a perfectly competitive firm. At the long-run…

A: In a perfectly competitive market, price is constant at all levels of output so it is equal to…

Q: In the short run, a perfectly competitive firm A : might not make an economic profit. b. will always…

A: The following problem has been answered as follows:

Q: Consider a market structure of perfect competition where firms have a U-shaped average cost curve.…

A:

Q: Create a graph that shows the cost curves and profit maximizing output level for a perfectly…

A: A perfectly competitive firm is characterized by five factors: infinite number of buyers and…

Q: Which of the following is always true when a perfectly competitive firm is producing at a profit…

A: In perfect competition, price is always constant. Marginal cost equals the increase in total cost…

Q: Consider a perfectly competitive market that was in a long-run equilibrium when a permanent increase…

A: A perfectly competitive market is one where there are several buyers and seller such that, all…

Q: Refer to the above graph for a purely competitive firm in the short run. What minimum output level…

A: In order to answer this question, it is imperative to understand the concepts of breakeven and…

Q: Would a perfectly competitive firm produce if price were less than the minimum level of average…

A: In perfectly competitive market, there are large number of firms selling identical goods.

Q: If a perfectly competitive firm decides to operate at a loss in the short run, it will minimize that…

A: There could be a case when a perfectly competitive market face a loss in the short-run, but it still…

Q: A perfectly competitive firm is making a loss if

A: We have to find a perfectly competitive firm is making a loss.

Q: in a perfectly competitive industry, in the long run, firms earn a positive economic profit firms…

A: In financial matters, explicitly broad balance hypothesis, an ideal market, otherwise called an…

Q: . A competitive firm’s short-run supply curve is its ________ cost curve above its ________ cost…

A: 4. A competitive firm’s short-run supply curve is its________ cost curve above its ________ cost…

Q: The long-run supply curve for a competitive, decreasing cost industry is a) upward sloping b)…

A: Decreasing cost industry is the industry in which per unit cost decrease when output increase

Q: If an industry's long-run average total cost curve has a negative slope over an extended range of…

A: Monopolistic competition is a market structure where in large number of buyers sellers sell…

Q: Firms in the market for dog food are selling in a purely competitive market. A firm producing dog…

A: There are no entry barriers in the perfectly competitive firm. In the long run firms can enter and…

Q: The following figures depict the market supply and demand curves for a constant cost, competitive…

A: Perfect competition refers to the situation where there are large number of prouder and consumers…

Q: You are a business manager working for a firm in a purely competitive market and you just hired a…

A: a) The profit of a perfectly competitive firm is when its MC = price. Also, this firm is a price…

Q: Match the words from the list below to complete the following statement A price taker firm will…

A: There are large number of firms in perfect competition selling identical goods with no barriers to…

Q: In the above figure, The cost curves of a typical perfectly competitive curve are show. What will…

A: In a competitive firm due to free entry and exit the firm earns normal profit in the long run.

Q: In competitive markets economic profit becomes zero in the long-run. However, it is also possible…

A: In competitive markets, economic profit is zero, but with help of technological advancement, some…

Q: What is the meaning of ‘acceptable loss’ for a perfectly competitive firm ?

A:

Q: The short run supply curve of a firm is a) marginal cost curve b) average total cost curve c)…

A: A concept that describes the total quantity available to consumers of a specific service or goods is…

Q: Firms in the market for dog food are selling in a purely competitive market. A firm producing dog…

A: A competitive market is one in which numerous producers compete for the goods and services that we,…

Q: (Figure: Demand and Average Cost Curves) Which of the following diagrams represents the demand and…

A: We’ll answer the first question since the exact one wasn’t specified. Please submit a new question…