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Two competitive price-taking firms produce identical goods, have the same tech- nology, and must pay the same prices for their inputs. They have identical factories,
Two competitive price-taking firms produce identical goods, have the same tech- nology, and must pay the same prices for their inputs. They have identical factories, but firm 1 paid a higher price for its factory than rm 2 did. If they are both prot maximisers and have upward-sloping marginal cost curves, then in the short run we would expect firm 1 to have a higher output than rm 2
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