Perfect Competition

Profit maximization:  
1.  MR=MC
2.  The level of output where MR=MC
3.  The price at the MR=MC output compared to the ATC
        a.  If P>ATC--Economic Profit
        b.  If P=ATC--Normal Profit
        c.  If P < ATC but greater than AVC--Loss Minimizing
        d.  If P < AVC the firm will shut down

Perfect Competition: Short Run Loss to Long Run Equilibrium

Perfect Competition-SR Profit to LR Equilibrium

Short-run supply and shutdown decision

Khan Academy-Perfect Competition

In the short run firms can produce at a profit, at a loss, or shutdown.  

Shut Down Rule

Perfect Competition--Short Run

Behavior of firms and markets in the short run and in the long run

Long Run

Efficiency and perfect competition


Prefect Competition--Graphing