The LOWEST point on a perfectly competitive firm's short-run supply curve corresponds to the minimum point on the _____ curve.

Question

Quizplus · Accepted Answer

The short-run supply curve of a perfectly competitive firm is determined by the intersection of the marginal cost curve (MC) and the average variable cost curve (AVC). The lowest point on the short-run supply curve corresponds to the minimum point on the AVC curve, which represents the point where the firm is able to cover its variable costs, but not its fixed costs. Therefore, the best choice is B (AVC).

The LOWEST Point on a Perfectly Competitive Firm's Short-Run Supply