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Suppose All Firms Have Constant Marginal Costs That Are the Same

Question 105

Multiple Choice

Suppose all firms have constant marginal costs that are the same for each firm in the short run. In this case, the market level supply curve is ________ and producer surplus equals ________.


A) perfectly inelastic; fixed costs
B) perfectly inelastic; zero
C) perfectly elastic; fixed costs
D) perfectly elastic; zero

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