Where is the competitive firm's short-run supply curve located

Question

Quizplus · Accepted Answer

The short-run supply curve of a competitive firm is determined by its marginal cost curve. However, the firm will only produce output in the short-run if the price is greater than or equal to its average variable cost. Therefore, the portion of the marginal cost curve that lies above the average variable cost is the firm's short-run supply curve. This is because the firm will only produce output if the market price is above this level, as producing anything below this price would not even cover the variable costs of production.

Where Is the Competitive Firm's Short-Run Supply Curve Located