Author Question: If firms in a perfectly competitive market have dissimilar cost curves what will be the shape of the ... (Read 65 times)

PhilipSeeMore · **on:** Jun 30, 2018

If firms in a perfectly competitive market have dissimilar cost curves what will be the shape of the long-run supply curve?

Question 2

If the market price falls below the average-variable-cost, the firm will suspend production.
a. True
b. False
Indicate whether the statement is true or false

aadams68 · **Reply #1 on:** Jun 30, 2018

Answer to Question 1

If firms have dissimilar cost curves, such that there are more types of firms with finer differences between their costs, the long-run market supply curve will slope upward but show greater responsiveness than short-run supply.

Answer to Question 2

True