Exhibit 10-1
A perfectly competitive producer has the following short-run average cost curve and marginal cost curve:
SR AC = 2Q + 3
MC = 4Q + 3
where costs are measured in dollars and Q represents the firm's output in units.
-The firm whose short-run cost curves are given in Exhibit 10-1 has a long-run fixed cost of

Question

Quizplus · Accepted Answer

The long-run fixed cost is the minimum cost the firm must bear to produce any level of output in the long run. Since this information is not given in the exhibit, we assume it to be zero, which is the case for perfectly competitive firms without any fixed inputs. Therefore, the answer is A, $0.

Exhibit 10-1 A Perfectly Competitive Producer Has the Following Short-Run Average Cost