Chapter8: Production And Costs
Section8.4: Costs Of Production: Total, Average, Marginal
Problem 2ST
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Question
When will a business shut-down in the short-run?
Expert Solution
Step 1
Short-run: - it is a short time period in which some factors of production are variable and some are fixed in other words short run means that time period in which we can change or adjust only some factors of production.
Shut down point: - it is represented by that level of output where the firm is only able to recover its variable cost of production and earn loss if it continues production.
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