CFA Practice Question

There are 891 practice questions for this topic.

CFA Practice Question

The firm's short-run supply curve is the ______.
A. marginal cost curve
B. marginal cost curve above average variable cost
C. marginal cost curve above average total cost
Explanation: The marginal cost curve shows what quantity the firm will produce, given that price is at least equal to minimum average variable cost. Below minimum average variable cost, the firm supplies zero in the short run.

User Contributed Comments 3

User Comment
danlan Firm should produce at least the number where MC = AVC in order to continu
cahiz84 If MC<AVC, then the firm should close down
maniben bt if we see short run supply curve is yhe marginal cost curve.
You need to log in first to add your comment.