In the diagram above, RTX and STY are the marginal cost and the average cost curves responsively of a perfectly competitive firm. The supply curve of the firm is indicated by
The correct answer is A. TX
In the context of perfect competition, the supply curve of a firm is typically represented by the portion of the marginal cost curve (MC) that lies above the average variable cost curve (AVC).
This is because a firm will only supply goods if the price (which equals marginal cost in perfect competition) is above the average variable cost.
In this case, that would be segment TX.
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