Arrange the following in correct sequence to attain equilibrium under perfect competition.

(A) LRMC start rising.
(B) Both LRAC and LRMC fall.
(C) Both LRAC and LRMC rises.
(D) LRMC cuts LRAC from below.

Choose the correct answer from the options given below:

(B), (A), (D), (C)

The correct answer is Option (3) → (B), (A), (D), (C)

• (B) Both LRAC and LRMC fall. (Initial phase of increasing returns to scale/economies of scale, where costs are decreasing).

• (A) LRMC start rising. (The LRMC curve reaches its minimum and starts rising, indicating that marginal costs are increasing, even while the LRAC might still be falling or at its minimum).

• (D) LRMC cuts LRAC from below. (This point is the minimum of the LRAC curve, which is the point of optimum efficiency and the required condition for long-run equilibrium in perfect competition, where $\text{P}=\text{MR}=\text{LRMC}=\text{Minimum LRAC}$).

• (C) Both LRAC and LRMC rises. (After the point of equilibrium/minimum LRAC, both curves rise, indicating the phase of decreasing returns to scale/diseconomies of scale).