In the price range above minimum average variable cost,a perfectly competitive firm's supply curve is

Question

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At the price range above minimum average variable cost, a perfectly competitive firm will produce where marginal cost equals price in order to maximize profit. Therefore, the firm's supply curve will be the same as its marginal cost curve. Option A is incorrect because the firm will not supply at zero output. Option B is incorrect because it is not possible for a perfectly competitive firm to have a vertical supply curve. Option D is incorrect because the firm's supply curve will not be the same as its average variable cost curve. Option E is incorrect because one of the options (C) is correct.

In the Price Range Above Minimum Average Variable Cost,a Perfectly