How will a shift in the supply curve (increase in supply) affect the marginal and average total cost curves?
Let's say there is a shortage and a chicken vendor was able to source additional chicken from a new supplier, how will it affect his cost curves?
- OiyLv 61 month agoFavorite Answer
Simple. The supply curve is a marginal curve. so the shift of the supply curve means the shift of a marginal curve. Morover, Total cost is the sum of the marginal cost in all level of production or output. So the shift of the supply curve will also be the shift of the total cost and average cost curve whic is the total cost curve is divided by output.