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-(Table: Total Cost and Output)Use Table: Total Cost and Output,which describes Sergei's total costs for his perfectly competitive all natural ice cream firm.If there are 100 firms in the all-natural ice cream industry,which point falls on the industry short-run supply curve (assuming firms can only produce whole quantities of output)?

Question

Use the following to answer question: 
-(Table: Total Cost and Output)Use Table: Total Cost and Output,which describes Sergei's total costs for his perfectly competitive all natural ice cream firm.If there are 100 firms in the all-natural ice cream industry,which point falls on the industry short-run supply curve (assuming firms can only produce whole quantities of output)?

Quizplus · Accepted Answer

The industry short-run supply curve is determined by the marginal cost curve of the firm at the minimum point of the average variable cost curve. At point D, the marginal cost is $70 and it is at the minimum point of the AVC curve. Therefore, point D falls on the industry short-run supply curve assuming all firms in the industry have the same cost structure as Sergei's firm.

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