The supply curve of a perfectly competitive firm in the short run is

CA Foundation · Business Economics · PYQS · September 2024
The supply curve of a perfectly competitive firm in the short run is
(A) A. the portion of the Marginal Cost curve which lies above the minimum point of Average Variable Cost curve.
(B) B. the portion of the Marginal Cost curve which lies below the minimum point of Average Variable Cost curve.
(C) C. the portion of the Average Cost curve which lies below the minimum point of Average Variable Cost curve.
(D) D. the part of the Average Cost curve which lies above the Marginal Cost curve.

Suggested Answer and Working Notes:

Correct Answer: Option (A)

A. the portion of the Marginal Cost curve which lies above the minimum point of Average Variable Cost curve.

Topics: Theory of Demand and Supply, Theory of Production and Cost

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