Here is information pertaining to a firm operating in a perfectly competitive marke Price $10.00 Output Total Revenue (TR) $8,000 Total Cost (TC) Total Fixed Cost (TFC) $2,800 Total Variable Cost (TVC) Average Total Cost (ATC) $12.00 Average Variable Cost (AVC) Minimum Marginal Cost (MC) Based off of the provided information answer the following 3 questions: What is the firm's average variable cost (AVC)? What is the firm's marginal cost (MC Should the firm decrease production or shut down in the short run? O $8.5; 8.5; shut down $8.5; $8.5; shut down $8.5; $8.5; increase production O None of the available answers $8; $8; decrease production

ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Here is information pertaining to a firm operating in a perfectly competitive market:
Price
$10.00
Output
Total Revenue (TR)
$8,000
Total Cost (TC)
Total Fixed Cost (TFC)
$2,800
Total Variable Cost (TVC)
Average Total Cost (ATC)
$12.00
Average Variable Cost (AVC) Minimum
Marginal Cost (MC)
Based off of the provided information answer the following 3 questions:
What is the firm's average variable cost (AVC)? What is the firm's marginal cost (MC)?
Should the firm decrease production or shut down in the short run?
O $8.5; 8.5; shut down
$8.5; $8.5; shut down
$8.5; $8.5; increase production
None of the available answers
$8; $8; decrease production
Transcribed Image Text:Here is information pertaining to a firm operating in a perfectly competitive market: Price $10.00 Output Total Revenue (TR) $8,000 Total Cost (TC) Total Fixed Cost (TFC) $2,800 Total Variable Cost (TVC) Average Total Cost (ATC) $12.00 Average Variable Cost (AVC) Minimum Marginal Cost (MC) Based off of the provided information answer the following 3 questions: What is the firm's average variable cost (AVC)? What is the firm's marginal cost (MC)? Should the firm decrease production or shut down in the short run? O $8.5; 8.5; shut down $8.5; $8.5; shut down $8.5; $8.5; increase production None of the available answers $8; $8; decrease production
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