If a firm in a perfectly competitive market faces the cost curves in the graph shown and produces at the profit-maximizing level of output, which of the following is true? A firm will:
A. make positive profits any time the price is greater than $15.
B. lose money and shut down in the short run if price falls below $15.
C. lose money, but continue to operate in the short run if price is at least $15.
D. All of these are true.
Answer: A
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