Billy Bob's Fertilizer Engineers, a perfectly competitive firm, is incurring a loss, but the price is still above minimum average variable cost. Then in the short run this firm should ________, and in the long run, if there is no change in economic conditions, this firm should ________.
A. shut down; expand
B. shut down; exit the industry
C. produce where MR = MC; exit the industry
D. produce where MR = MC; expand
Answer: C
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