Suppose a firm has unavoidable fixed costs of $500,000 per year, and it decides to shut down. What is the firm's producer surplus?
A) PS is positive in this case, but we cannot determine the value based on the given information
B) PS is negative in this case, but we cannot determine the value based on the given information
C) PS = -$500,000
D) PS = 0
A
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Many less developed countries have low rates of economic growth because
a. high population growth rates reduce living standards b. low population growth rates result in an inadequate labor supply c. high current output per capita reduces incentives for growth d. interest rates are too high e. they invest too much in infrastructure leaving little for private capital investment
Demand is said to be inelastic if the
a. quantity demanded changes proportionately more than price. b. price changes proportionately more than income. c. quantity demanded changes proportionately less than price. d. quantity demanded changes proportionately the same as price.