Good Z Is Produced and Sold in a Competitive Industry,and

Multiple Choice

Good Z is produced and sold in a competitive industry,and long-run industry supply is characterized by constant costs.The figure below shows a typical long-run average cost curve (LAC) for each of the firms producing good Z.LAC reaches its minimum unit cost of $12 and 1,000 units of output (point M) .Suppose the demand for good Z is Q_d = 52,000 - 1,000P. In long-run competitive equilibrium,each firm's long-run marginal cost (LMC) is $_____ and each firm's long-run average cost (LAC) is $_______.

A) 40; 12
B) 12; 40
C) 40; 40
D) 0; 12
E) none of the above