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Competitive market (特色 (Many buyer and sellers, identical products, Freely…
Competitive market
特色
Many buyer and sellers
identical products
Freely entry and exit
Price taker
P=MR=AR
MC curve=supply curve
Try to maximize profit
Exit
TR<TC
P<ATC
Long run
Supply curve is perfectly elastic
Not pay any cost
Shut down
TR<VC
P<AVC
Short run
P>AVC
Supply curve=MC
Pay FC
Sunk cost
Don't cry over split milk
