Suppose a perfectly competitive firm finds a way to reduce its fixed cost. Briefly explain whether each
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Suppose a perfectly competitive firm finds a way to reduce its fixed cost. Briefly explain whether each of the following will change for the firm. Use a graph to illustrate your answer.
a. Average total cost
b. Profit
c. Average variable cost
d. Marginal cost
e. Average fixed cost
f. The firm’s supply curve
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The ATC and AFC curves will shift downward but the ma...View the full answer
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