If price is consistently below average variable cost, then in the short run a perfectly competitive firm should: A. raise price. B. sell more output. C. shut down. D. lower price to sell more.
If price is consistently below average variable cost, then in the short run a perfectly competitive firm should: A. raise price. B. sell more output. C. shut down. D. lower price to sell more.
Managerial Economics: A Problem Solving Approach
5th Edition
ISBN:9781337106665
Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Chapter5: Investment Decisions: Look Ahead And Reason Back
Section: Chapter Questions
Problem 5.7IP
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Question
If
- A. raise price.
- B. sell more output.
- C. shut down.
- D. lower price to sell more.
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