Supply is the quantity of a good that a profit-maximising firm is willing to sell at different market prices, keeping technology and prices of factors of production constant. This assumption ensures that only the effect of price on the quantity supplied is studied. Option D is correct because it states the standard NCERT assumption used while defining supply. Option A is incorrect because demand and total cost are not the fixed assumptions in the definition of supply. Option B is incorrect because fixed and variable costs may change with changes in technology or factor prices; they are not the stated assumptions. Option C is incorrect because market size and consumer income affect demand rather than the firm's supply decision.

A supply schedule is a table showing the quantity supplied by a firm at different market prices while keeping other factors constant. It is the numerical representation of supply. Option C is correct because a supply schedule is always presented in tabular form. Option A is incorrect because an equation represents a supply function, not a supply schedule. Option B is incorrect because a horizontal line is a graphical concept, not a schedule. Option D is incorrect because a curve represents the graphical form of supply, whereas a schedule is numerical.

In the standard supply graph: Quantity supplied (output) is measured on the x-axis. Market price is measured on the y-axis. Therefore: Statement II is correct. Statement III is correct. Statement I is incorrect because output is not plotted on the y-axis. Hence, Option D is correct.

The firm's supply curve shows how much output the firm chooses to produce at different market prices, assuming technology and factor prices remain unchanged. Option B is correct because market price is the independent variable affecting supply. Option A is incorrect because average cost influences profitability but is not plotted as the determining variable. Option C is incorrect because under perfect competition, marginal revenue equals price but the supply curve is expressed in terms of market price. Option D is incorrect because fixed cost does not determine the supply curve.

The short-run supply curve consists of the rising portion of the SMC curve above the minimum AVC. Therefore: 1 → a (Upper part = Rising part of SMC) 2 → b (Positive output when Price ≥ Minimum AVC) 3 → c (SMC curve represents SR supply) 4 → d (SMC below minimum AVC is excluded) Hence, Option B is the correct match. The remaining options incorrectly pair one or more concepts, violating the NCERT conditions for short-run supply.

As the market price gradually increases from zero: Step 1: Price is less than minimum AVC, so the firm produces zero output. Step 2: Price becomes equal to minimum AVC, which is the shutdown point. Step 3: When price rises above minimum AVC, it intersects the rising part of the SMC curve, leading to positive output. Step 4: If price increases further and exceeds average cost, the firm earns profit (represented by the profit area on the graph). Thus, the correct sequence is 2 → 1 → 3 → 4, making Option A correct.

A perfectly competitive firm maximises profit in the short run when: Price = Marginal Cost (SMC). SMC is rising at the equilibrium output. Price is at least equal to minimum AVC, ensuring production is worthwhile. The question explicitly states all these conditions. Therefore, Option D is correct. Option A is incorrect because profit depends on comparison with average cost, not merely AVC. Option B is incorrect because losses equal to TFC occur only at shutdown. Option C is incorrect because the firm continues producing when price exceeds minimum AVC.

Since Price (₹10) is less than Minimum AVC (₹15), the firm stops production. At shutdown: Total Revenue = ₹0 Variable Cost = ₹0 Fixed Cost must still be paid. Therefore, Profit = Total Revenue − Total Cost = 0 − ₹100 = –₹100 Hence, Option B is correct.

The firm's supply curve includes only the rising portion of the SMC curve because profit maximisation requires that marginal cost be increasing (non-decreasing) at the equilibrium output. The falling part of the SMC curve fails this condition, making it an unstable equilibrium. Therefore, Option C is correct. Option A is incorrect because total revenue is never negative. Option B is incorrect because AFC is unrelated to this condition. Option D is incorrect because the exclusion is due to the behaviour of MC, not because price is always greater than MC.

The passage clearly states that market price is below LRAC for every positive output level. Since the firm cannot even cover its long-run average cost, producing any positive quantity would result in losses. Therefore, the rational decision is to produce zero output, making Option D correct. Option A is incorrect because firms cannot avoid long-run losses simply by shifting to the short run. Option B is incorrect because the condition for positive production is not satisfied. Option C is incorrect because break-even occurs when Price = LRAC, not when Price < LRAC.

In the long run, all costs are variable, and a firm will continue production only if it can recover its Long Run Average Cost (LRAC). Therefore, a profit-maximising firm supplies a positive output only when market price is greater than or equal to the minimum LRAC. Option A is correct because it states the necessary condition for long-run production. Option B is incorrect because profit maximisation requires LRMC to be rising, not decreasing. Option C is incorrect because minimum AVC is relevant only in the short run, not in the long run. Option D is incorrect because firms aim to maximise profit, not intentionally earn zero revenue.

The long-run supply curve includes only those output levels where the firm can recover all production costs. If market price is below the minimum LRAC, the firm cannot cover its total costs and therefore supplies zero output. Hence, Option C is correct. Option A is incorrect because Price = LRMC is only one equilibrium condition and does not ensure profitability. Option B is incorrect because prices greater than minimum average cost encourage production rather than exclusion. Option D is incorrect because minimum AVC applies only to the short run.

The Assertion is correct because a perfectly competitive firm produces where Price = LRMC on the rising portion of the LRMC curve, provided that Price ≥ Minimum LRAC. The Reason is incorrect because a firm does not continue production when Price < Minimum LRAC. Instead, it exits the market in the long run. Therefore, Assertion is true and Reason is false, making Option B correct.

A firm remains in the market only if it can recover all long-run costs. When market price is consistently below minimum LRAC, continuing production would generate persistent losses. Therefore, the firm exits the market, and its output becomes zero. Hence, Option B is correct. Option A is incorrect because firms do not enter when losses are certain. Option C is incorrect because domination is impossible under persistent losses. Option D is incorrect because monopolisation has no connection with this cost condition.

The long-run supply curve of a perfectly competitive firm is the rising portion of the LRMC curve that lies above the minimum point of the LRAC curve. This portion satisfies both conditions: Price = LRMC for profit maximisation. Price ≥ Minimum LRAC for continued production. Therefore, Option A is correct. Option B is incorrect because the falling LRMC does not satisfy equilibrium. Option C is incorrect because the supply curve is not represented by the distance between two curves. Option D is incorrect because a horizontal price line is not the firm's supply curve.

The correct matching is: 1 → a: If Price < Minimum LRAC, the firm cannot recover total costs and supplies zero output. 2 → b: If Price ≥ Minimum LRAC, the firm can profitably produce a positive output. 3 → d: In long-run equilibrium, firms that remain in the industry earn normal profit (zero economic profit). Firms unable to cover costs exit the market. (Although the wording "profit when exiting" is slightly awkward, the intended NCERT concept is zero economic profit in long-run equilibrium.) 4 → c: The minimum point of the LRAC curve is the break-even point, where the firm earns only normal profit. Therefore, Option D is correct.

The shutdown point is the minimum point of the Average Variable Cost (AVC) curve. At this point: SMC intersects AVC at its minimum. Price equals minimum AVC. If price falls below this level, the firm stops production and bears only fixed costs. Therefore, Option C is correct. Option A is incorrect because the intersection of SMC and SAC determines the minimum SAC, not the shutdown point. Option B refers to the long-run cost curves. Option D has no relation to the shutdown condition.

In the long run, all production costs are variable. Therefore, the firm continues production only if it can recover its Long Run Average Cost (LRAC). The minimum point of the LRAC curve acts as the long-run shutdown or exit point. Hence, Option A is correct. Option B is incorrect because LRMC determines output, not the shutdown decision. Option C is incorrect because TR = TC represents break-even but does not define the long-run shutdown point. Option D is incorrect because SAC is a short-run cost concept.

Normal profit is the minimum earning required by an entrepreneur to remain in the current business. It is treated as an opportunity cost and is therefore included in the firm's total cost. When a firm earns only normal profit, it covers both explicit and implicit costs but earns zero economic profit. Thus, Option D is correct. Option A is incorrect because it refers to contribution towards fixed costs rather than normal profit. Option B is incorrect because normal profit is unrelated to returns on fixed assets. Option C is incorrect because shutdown losses relate to fixed costs, not normal profit.

At the break-even point, the firm's Total Revenue (TR) is exactly equal to its Total Cost (TC). This means: The firm covers all explicit and implicit costs. It earns normal profit. Economic profit is zero, but the firm has no incentive to leave the industry. Therefore, Option B is correct. Option A is incorrect because TR > TC indicates supernormal profit. Option C is incorrect because TR < TC indicates losses. Option D is incorrect because TR equals TC, not merely Total Variable Cost.