A firm will shut down in the short-run whenever*
price is less than ATC.
price is less than AFC.
price is less than
MR is equal to MC.
The slope of total curves/functions (e.g., TP, TC, TR) is*
their marginal values.
the shape of the curve/function.
their average values.
none of the above
Which of the following statements is correct?*
In order to maximize profits in the short run, a purely competitive firm should produce at the level where marginal cost is equal to price.
A purely competitive firm will produce in the short run, so long as total receipts are sufficient to cover its total fixed costs. 2
A purely competitive firm will always close down in the short run, whenever price is less than
In the long-run, firms incur costs that are fixed and variable.
When the firm generates sales that is enough to cover its costs the firm is experiencing*
zero
losses.
break-even.
both A and C above
In the long run, average total cost exhibits a pattern just like the short run average total cost because of this reason.
Increasing and decreasing returns are associated with more outputs produced.
Economies and diseconomies of scale are experienced as a firm gets bigger in size.
Law of diminishing returns starts to set in.
None of the above explains the shape of a long run average total cost curve
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