The following question are based on the following diagram of a perfectly competitive firm:

-What is the minimum output that the firm would produce in the short run?

Question

The following question are based on the following diagram of a perfectly competitive firm:
 
-What is the minimum output that the firm would produce in the short run?

Quizplus · Accepted Answer

In the short run, a firm will continue to produce as long as it can cover its variable costs, even if it's not covering its total costs. The minimum output corresponds to the point where price equals marginal cost, assuming it's above average variable cost. Without specific cost data, we typically consider the lowest output level provided in the options as the minimum viable output that covers variable costs, hence 40 units.

The Following Question Are Based on the Following Diagram of a Perfectly