Graphing Cost Curves Together
Cost curves can be combined to provide information about firms. In this diagram for example, firms are assumed to be in a perfectly competitive market. In a perfectly competitive market the price that firms are faced with would be the price at which the marginal cost curve cuts the average cost curve.
Read more about this topic: Cost Curve
Famous quotes containing the words cost and/or curves:
“Now that is the wisdom of a man, in every instance of his labor, to hitch his wagon to a star, and see his chore done by the gods themselves. That is the way we are strong, by borrowing the might of the elements. The forces of steam, gravity, galvanism, light, magnets, wind, fire, serve us day by day and cost us nothing.”
—Ralph Waldo Emerson (1803–1882)
“At the end of every diet, the path curves back toward the trough.”
—Mason Cooley (b. 1927)