The Student Room Group

micro economics - high cost & low cost firms in competitive industry - demand curve

hi guys

bit stuck on this, could someone explain the gist of it to me?

if there is a competitive industry where all firms have U-shaped AC curves,
except some are high cost with high AC and MC, and some low cost with low AC and MC, how do i explain why all firms would face the same perfectly elastic demand curve, produce output at the same MC and that the low cost firms produce more output than the high cost ones?

if both types of firms last it out in the industry, what can we deduce about their profits and the costs of entry to the market?

im confused about the market system described, is it some kind of oligopoly or just perfect competition? do i need to mention minimum efficient scales?

ty in advance

MRTC

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