If a competitive firm finds that it maximizes short-run profits by shutting down, which of the following must be true?
A) p < AVC for all levels of output.
B) p < AVC only for the level of output at which p = MC.
C) p < AVC only if the firm has no fixed costs.
D) The firm will earn zero profit.
A
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The following data relate to the supply schedule of a product.PriceQuantity Supplied$51001020015250203002535030500Using the regular percentage change formula, what is the price elasticity of supply when price decreases from $10 to $5?
A. 0.2 B. 0.5 C. 0.6 D. 1
Opportunity cost is usually measured in terms of money
Indicate whether the statement is true or false
A decline in bank lending has the most significant effect on
A) small businesses. B) large businesses. C) state governments. D) federal government.
Explain why the rise in the price of a fixed basket of goods tends to overstate the rise in a consumer's true cost of living