Question

figure 13-11 price and cost per unit p4 p3 p2 p1 mc atc mr demand 0 q1 q2 q3 q4 quantity refer to figure 13-11. the diagram depicts a firm in a constant - cost industry. in an increasing - cost industry. in long - run equilibrium. that is making short - run losses.

Explanation:

In a constant - cost industry, the long - run supply curve is horizontal and input prices do not change as industry output changes. The diagram shows a firm's cost and revenue curves, but there is no clear indication of long - run equilibrium (where P = MC = ATC), and the firm is not necessarily making short - run losses. Since there is no information about how costs change as industry output changes, we cannot say it's an increasing - cost industry. The key here is that nothing in the diagram suggests input cost changes with industry output, which is characteristic of a constant - cost industry.

Answer:

in a constant - cost industry.