Should a firm shut down if its weekly revenue is $1,000, its variable cost is $900, and its fixed cost is $600, of which $450 is avoidable if it shuts down? Why? The firm should A. shut down because revenue of $1,000 is less than avoidable costs. B. produce because because variable costs are greater than fixed costs. OC. produce because revenue of $1,000 is greater than fixed costs. D. produce because revenue is positive. O E. produce because revenue of $1,000 is greater than variable costs.
Should a firm shut down if its weekly revenue is $1,000, its variable cost is $900, and its fixed cost is $600, of which $450 is avoidable if it shuts down? Why? The firm should A. shut down because revenue of $1,000 is less than avoidable costs. B. produce because because variable costs are greater than fixed costs. OC. produce because revenue of $1,000 is greater than fixed costs. D. produce because revenue is positive. O E. produce because revenue of $1,000 is greater than variable costs.
Chapter12: Firms In Perfectly Competitive Markets
Section: Chapter Questions
Problem 9P
Related questions
Question
![Should a firm shut down if its weekly revenue is $1,000, its variable cost is $900, and its fixed cost is $600, of which $450 is avoidable if it shuts down? Why?
The firm should
A. shut down because revenue of $1,000 is less than avoidable costs.
B. produce because because variable costs are greater than fixed costs.
OC. produce because revenue of $1,000 is greater than fixed costs.
D. produce because revenue is positive.
O E. produce because revenue of $1,000 is greater than variable costs.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F15075cbb-1585-4001-8b39-493310d05b8a%2F77a413ff-1e05-4919-935a-faa2664837ec%2Fznravqf.png&w=3840&q=75)
Transcribed Image Text:Should a firm shut down if its weekly revenue is $1,000, its variable cost is $900, and its fixed cost is $600, of which $450 is avoidable if it shuts down? Why?
The firm should
A. shut down because revenue of $1,000 is less than avoidable costs.
B. produce because because variable costs are greater than fixed costs.
OC. produce because revenue of $1,000 is greater than fixed costs.
D. produce because revenue is positive.
O E. produce because revenue of $1,000 is greater than variable costs.
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