The short-run supply curve for a firm operating in perfect competition is:
A)the firm's marginal cost curve.
B)the firm's average variable cost curve.
C)the firm's average variable cost curve above marginal cost.
D)the firm's marginal cost curve above the shut down price.

Question

Quizplus · Accepted Answer

The short-run supply curve for a firm in perfect competition is its marginal cost curve above the shutdown price. This is because the firm will only supply goods if the price covers at least the average variable costs, otherwise, it would minimize losses by shutting down.

The Short-Run Supply Curve for a Firm Operating in Perfect