In a price-taker market, the short-run market supply curve is the
A) vertical sum of the marginal cost curves of all firms in the market.
B) vertical sum of the average variable cost curves of all firms.
C) horizontal sum of the marginal cost curves of all firms so long as price exceeds average variable cost.
D) horizontal sum of the average total cost curves of all the firms in the market so long as average total cost exceeds the market price.

Question

Quizplus · Accepted Answer

In a price-taker market, the short-run market supply curve is the horizontal sum of the marginal cost curves of all firms, provided that the price is above the average variable cost, ensuring firms cover their variable costs and continue producing.

In a Price-Taker Market, the Short-Run Market Supply Curve Is