MCP=AR=MRATCAVCQuantityThe firm in the graph above represents the cost structure for all firms in the industry.a. What change will lead to long-run equilibrium in this market?O AVC will increase.O MC will decrease.O MR will decrease.O ATC will increase.b. The change in the graph above will be caused by:the market supply curve shifting to the right.O the market demand curve shifting to the right.O the market supply curve shifting to the left.O the market demand curve shifting to the left.Price

This is a case of perfectly competitive market where price is decided by the market forces of demand…

MC P=AR=MR ATC AVC Ouantitv he firm in the graph above represents the cost structure for all firms in the industry. What change will lead to long-run equilibrium in this market? O AVC will increase. O MC will decrease. O MR will decrease

MC P=AR=MR ATC AVC Ouantitv he firm in the graph above represents the cost structure for all firms in the industry. What change will lead to long-run equilibrium in this market? O AVC will increase. O MC will decrease. O MR will decrease

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

MC
P=AR=MR
ATC
AVC
Quantity
The firm in the graph above represents the cost structure for all firms in the industry.
a. What change will lead to long-run equilibrium in this market?
O AVC will increase.
O MC will decrease.
O MR will decrease.
O ATC will increase.
b. The change in the graph above will be caused by:
the market supply curve shifting to the right.
O the market demand curve shifting to the right.
O the market supply curve shifting to the left.
O the market demand curve shifting to the left.
Price

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