c. Which of the choices best explains why this price will cause the firm to shut down instead of continuing to operate at a loss? O total revenue < total fixed costs total revenue> total variable costs total revenue < total variable costs total variable costs > total fixed costs O total variable costs < total fixed costs total revenue > total fixed costs
c. Which of the choices best explains why this price will cause the firm to shut down instead of continuing to operate at a loss? O total revenue < total fixed costs total revenue> total variable costs total revenue < total variable costs total variable costs > total fixed costs O total variable costs < total fixed costs total revenue > total fixed costs
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:c. Which of the choices best explains why this price will
cause the firm to shut down instead of continuing to
operate at a loss?
total revenue < total fixed costs
O total revenue> total variable costs
total revenue < total variable costs
total variable costs > total fixed costs
total variable costs < total fixed costs
total revenue > total fixed costs

Transcribed Image Text:The following information describes relevant curves for an individual firm in a perfectly (or purely) competitive industry. Use
the information to answer the questions that follow.
A marginal cost curve intersects average total cost at $6. This curve also intersects average total cost at $9.
a. It is most accurate to say this firm will generate a loss
at any price
Obelow $9
below $6
above $6
O above $9
b. At what price level will this firm shut down.
immediately, with certainty?
O Any price below $6
O Any price below $9
O Any price above $9
Any price above $6
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