Practice mode Costs , Supply And Perfect Competition

In the long run, what forms a competitive firm’s supply curve?

Correct answer E. The portion of the marginal cost curve that lies above the average total cost curve

Explanation

In the long run a firm exits unless price covers all its costs. It therefore supplies along marginal cost only where price is at or above average total cost.

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In the long run, what forms a competitive firm’s supply curve?

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In the long run, what forms a competitive firm’s supply curve?

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