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So MCs describes
the supply behaviour of the firm...provided that the firm produces at all.
Output rule
MR = MCs; price-taking behaviour implies
MR = p. Hence, profit maximisation gives p = MCs
Shutdowon condition
Supply condition: second order condition
Supply decision: first order condition
Demand curve facing a competitive firm graph
Assumptions of the perfect competition
Many firms, all making the same product.
Each firms output level is small relative to the total
Cost curves
