00:01
Hello, schwentz.
00:02
We need to write here assume that the firm is operating in a perfectly competitive market at its break -even level of output, which of the following is false.
00:10
We need to write here in case of.
00:13
So first case is perfectly competitive competitive market.
00:23
So for that case, if i write here for this, for that marginal cost, is basically equivalent to average revenue for perfectly competitive market is basically equivalent to marginal revenue so if i write here clearly let's read our first sentence marginal cost and average revenue are equal so this is correct marginal cost and marginal revenue revenue are equal marginal cost and marginal revenue are equal so this is also correct.
01:05
Now if i write here to the b part, if i write here for this, we need to the firm.
01:13
The firm is operating at perfectly competitive market, perfectly competitive market and we need to write here.
01:31
This must be market and we need to write here market is at a shutdown level of output and market is at its shutdown level of output.
01:58
So what does it mean? it means that at this condition marginal cost is basically equivalent to marginal cost is basically equivalent to minimum average variable cost.
02:16
So minimum average variable cost.
02:23
So this is not a total cost or not the fixed cost.
02:27
So if i write here marginal cost and average variable cost are equal because we are given both the conditions but this is not equal...