What Is a Long-Run Supply Curve? What Does a Long-Run

question 287

Essay

What is a long-run supply curve? What does a long-run supply curve look like on a perfectly competitive market graph?

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Definitions:

Producer Surplus

The difference between the amount producers are willing to accept for a good or service versus what they actually receive, usually a measure of profit.

Market Price

The price at which a service or asset is presently traded in a given market.

Full Cost

Full cost involves calculating the total cost of production, including both fixed and variable costs, to assess the overall expenses incurred by a business.

Consumer Surplus

The difference between what consumers are willing to pay for a good or service and what they actually pay, representing the benefit to consumers from market transactions.