If the price of its product falls below the minimum point on the AVC curve, the best a perfectly competitive firm can do is to
A) keep producing and incur an economic loss equal to its total variable cost.
B) keep producing and incur an economic loss equal to its total fixed cost.
C) shut down and incur an economic loss equal to its total variable cost.
D) shut down and incur an economic loss equal to its total fixed cost.
D
Economics
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What effects do U.S. trade deficits have on the U.S. economy?
What will be an ideal response?
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Exhibit 4-3 Supply and demand curves
In Exhibit 4-3, which of the following might cause a shift from S2 to S1?
A. A decrease in input prices. B. A decrease in technology. C. An increase in input prices. D. An increase in consumer income.
Economics