Alice,Bud,and Celia can produce rubber bands in a perfectly competitive market.If they enter the market,the minimum average total cost for a bundle of rubber bands,for the three of them is $2,$3,and $4,respectively.If the market price is $2.10 per bundle,then

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Quizplus · Accepted Answer

Only Alice will enter the market because her minimum average total cost ($2) is below the market price ($2.10), allowing her to make a profit. Bud and Celia's costs are above the market price, so they would incur losses.

Alice,Bud,and Celia Can Produce Rubber Bands in a Perfectly Competitive