Asked by
Kemark Rollan
on Nov 04, 2024
Verified
If price lies above the minimum point on the ATC curve, in the short run the firm should ________ and in the long run it should ________.
A) produce where MC = MR; exit the industry
B) shut down; exit the industry
C) produce where MC = MR; expand
D) shut down; expand
Minimum ATC
This refers to the lowest point on the average total cost curve, representing the most efficient scale of operation for a firm.
Short Run
refers to a period in which at least one input in the production process is fixed and cannot be changed.
Long Run
A period in economics where all factors of production and costs are variable, allowing companies to adjust to new conditions.
- Discern the conditions advising an organization to persist in activity, expand, contract, or wind up across short and lengthy spans.
- Gain insight into the correlation between price, marginal revenue, and the ideal levels of output.
Verified Answer
TP
Learning Objectives
- Discern the conditions advising an organization to persist in activity, expand, contract, or wind up across short and lengthy spans.
- Gain insight into the correlation between price, marginal revenue, and the ideal levels of output.