Exhibit 7-15 Short-run cost curves for E-Z Care lawn mowing company
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In Exhibit 7-15, suppose the market price of mowing lawns falls to $10 per lawn. In this situation, E-Z-Care will:
A. permanently exit the industry.
B. shut down its operations, at least in the short run.
C. continue to mow lawns in the short run despite its economic losses.
D. earn a normal profit.
Answer: C
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