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- Subject
- Costs , Supply And Perfect Competitioneconomics-mcqs › costs-supply-and-perfect-competition
- Published
- 2 Jun 2019
- Last updated
- 28 May 2026
Explanation
In the short run, a competitive firm's supply curve corresponds to the portion of the marginal cost curve that is above the average variable cost curve. This is because the firm will only produce when the price covers the variable costs, hence the supply curve starts from the point where marginal cost exceeds average variable cost.
More Costs , Supply And Perfect Competition MCQs
Practice related questions from the same subject.
- 1.In the context of a perfectly competitive firm, what represents its short-run supply curve and its long-run supply curve respectively?
- 2.Under what condition will a firm cease production and produce nothing in the short term?
- 3.In the short run, the average total cost is composed of which two components?
- 4.What is the relationship between marginal cost and average cost when the average cost is decreasing and when it is increasing?
- 5.What does it indicate when the long-run average cost curve slopes downward from left to right?
- 6.Which characteristic best describes a monopoly market structure?
- 7.According to Porter's Five Forces framework, what is the likely impact on supplier power when a company acquires one of its competitors?
- 8.In a monopolistic competition market, when firms earn abnormal profits, what is the expected effect on marginal cost as new firms enter the industry?
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