Exhibit 8-12 Marginal revenue and cost per unit curves

As shown in Exhibit 8-12, the firm's short-run supply curve is the:

Question

Exhibit 8-12 Marginal revenue and cost per unit curves

As shown in Exhibit 8-12, the firm's short-run supply curve is the:

Quizplus · Accepted Answer

The short-run supply curve is determined by comparing the market price to the marginal cost of production. In this diagram, the rising part of the marginal cost curve beginning at point E represents the point at which the firm's marginal costs exceed the price of the good, so the firm will not produce any units beyond this point. As a result, the short-run supply curve is the rising part of the marginal cost curve beginning at E.

Exhibit 8-12 Marginal Revenue and Cost Per Unit Curves