Asked by
Shunquala Robinson
on Dec 11, 2024
Verified
The price-taker firm should discontinue production immediately if
A) the market price exceeds the firm's average total costs.
B) the market price is less than the firm's average variable costs.
C) the market price is less than the firm's average total costs but greater than its average variable cost.
D) its accounting statement indicates that it is suffering losses.
Average Variable Costs
The total variable costs of production divided by the quantity of output produced, indicating the cost of producing each unit.
Average Total Costs
Represents the total expense per unit of output, comprising both fixed and variable costs, essential for assessing a company’s efficiency.
- Uncover the conditions necessitating a business to persist, contract, or cease production activities in the short-term context.
Verified Answer
AM
Learning Objectives
- Uncover the conditions necessitating a business to persist, contract, or cease production activities in the short-term context.