The short-run market supply curve is
A)the horizontal summation of each firm's short-run supply curve.
B)the vertical summation of each firm's short-run supply curve.
C)the horizontal summation of each firm's short-run average cost curve.
D)the vertical summation of each firm's short-run average cost curve.

Question

Quizplus · Accepted Answer

The short-run market supply curve is the horizontal summation of each individual firm's short-run supply curve. This is because in the short run, the number of firms in the market is fixed, and each firm has a certain quantity of output it is willing and able to supply at different prices. The market supply at each price is the sum of the quantities supplied by each firm. Therefore, the short-run market supply curve is obtained by adding horizontally the individual firm's supply curves.

The Short-Run Market Supply Curve Is