Suppose an Industry Has No Fixed Costs

question 9

Essay

Suppose an industry has no fixed costs.Draw two graphs side by side for the industry.In the left graph draw a U-shaped average cost curve and the corresponding marginal cost curve.In the right graph,draw a downward-sloping market demand curve.Also in the right graph,draw a short-run supply curve that would generate positive profit,and the long-run supply curve that would result.

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Definitions:

Essential Question

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Semistandardized Interview

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