The figure given below shows the aggregate demand and supply curves of a perfectly competitive market.Figure 10.7

-A firm's break-even price is the price that is just equal to the minimum point of the AVC curve, in the short run.

Question

The figure given below shows the aggregate demand and supply curves of a perfectly competitive market.Figure 10.7
 
-A firm's break-even price is the price that is just equal to the minimum point of the AVC curve, in the short run.

Quizplus · Accepted Answer

A firm's break-even price is the price at which total revenue equals total cost, not just the minimum point of the Average Variable Cost (AVC) curve. The break-even point considers both fixed and variable costs.

The Figure Given Below Shows the Aggregate Demand and Supply