why will a perfectly competitive firm will always produce in the upward segment of the marginal cost curve?

Question

could you also explain the graph?

Answer 1

The marginal cost curve slopes downward, reaches a minimum, then goes back up. If a firm produces where it crosses marginal revenue and is sloping downward, it will produce only units that cost more to make than they earn in revenue. The firm will lose money and eventually go out of business. When it produces at the point where marginal cost is going up, it is able to turn a profit.

Answer 2

The downward section hasn't taken full advantage of increasing returns nor pulled out of stage one production. Most production decisions occur within stage two production where diminishing returns are present. The benefit to revenue over cost by producing more is going to happen on the upward portion of this MC schedule.
Because the portion of a marginal cost curve which is at or above minimum average variable cost is the short runs supply curve. We read MC on the upswing because that is when we have exhausted stage one production (law of diminishing returns kicks in). With a MR schedule that is horizontal at market price, we balance MR with MC. As long as this balance position on your graph is at or above minimum AVC, then output is forth coming. If price were to ever go below min. AVC, we would shut down and accept the fixed cost loss.

Answer 3

Because as long as the curve is heading downward, it is still cheaper to make the next order/widget than the last one. When the marginal cost curve heads upward, then the cost goes up to make the next piece and you would only make production that cost less than what you want to sell it for.