10/27 Recap

NO FIXED COSTS

NEW FIRMS ENTER MARKET

PRICE STARTS FALLING

PUSHES PRICE TOWARDS EQUILIBRIUM PRICE

MARKET SUPPLY INCREASE

LOOSE MONEY OVERTIME

PRICE GO UP

LOOSING MONEY NOW

MARKET SUPPLY DOWN

P < AVC

TR < VC

FIRMS EXIT

P > AVC

P CONTRIBUTING TOWARDS FC

PAY FIXED COST

FIRMS CAN'T COVER TOTAL EC