The short-run supply curve of a firm in perfect competition is the rising segment of its short-run:
A)marginal cost curve.
B)average fixed cost curve.
C)average variable cost curve.
D)marginal cost curve above its average variable cost curve.
E)average total cost curve.

Question

Quizplus · Accepted Answer

The short-run supply curve of a firm in perfect competition is the portion of the marginal cost curve that lies above the average variable cost curve. This is because a firm will only supply output in the short run if the price covers the average variable costs, making this segment relevant for supply decisions.

The Short-Run Supply Curve of a Firm in Perfect Competition