1. Assume diminishing marginal product, constant returns to scale and perfect competition.
a. How do you draw short-run marginal cost, average total cost and average variable cost curves for the firm?
b. Where is the market prices that induce entry, exit and shutdown on this graph?
c. How do you draw the short-run supply curve for the market? How do you describe the relationship between the short-run supply curve for the market and the firm's cost curves?
d. How do you draw the long-run supply curve?
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