The long-run supply curve of a firm follows the conditions:

P > LRAC : exit

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P < LRAC : exit

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P > LRAC : produce

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P < LRAC : produce

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Solution

The correct options are
B
P < LRAC : exit

C
P > LRAC : produce

If P < LRAC, the firm exits. If P > LRAC, the firm produces at an output level corresponding to MR=MC.

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Similar questions

The costs (LRAC) and prices (P) for four firms are given in the options below. Which of these cannot lie on the long-run supply curve of a firm?

Q. When price line is below minimum LRAC, firm produces _____________.

Q. LRAC curve is ____.

Q. In perfect competition, when price is less than minimum LRAC firm produces ______.

The minimum point of a firm's LRAC is Rs 8, at which it produces a quantity of 500. Which of the following price-quantity pairs (p,q) can lie on the supply curve?

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The long-run supply curve of a firm follows the conditions:

The correct options are B P < LRAC : exit C P > LRAC : produce If P < LRAC, the firm exits. If P > LRAC, the firm produces at an output level corresponding to MR=MC.

The correct options are
B
P < LRAC : exit

C
P > LRAC : produce

If P < LRAC, the firm exits. If P > LRAC, the firm produces at an output level corresponding to MR=MC.