The following graph shows the long-run average cost curve for a firm in a perfectly competitive industry.
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The following graph shows the long-run average cost curve for a firm in a perfectly competitive industry. Draw a set of short-run cost curves consistent with output QE and use them to explain:
- Why the only output that a competitive firm will produce in the long run is QE
- Why it will be a profit-maximizing decision to produce more than QE in the short run if the price exceeds PE
![image text in transcribed](https://s3.amazonaws.com/si.experts.images/answers/2024/06/66794411dadc6_31366794411c69f1.jpg)
![image text in transcribed](https://s3.amazonaws.com/si.experts.images/answers/2024/06/667944123cc17_3146679441228312.jpg)
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