If the price for a firm's output is greater than the minimum value of its average variable cost, but less than the minimum value of its average total cost, then the firm should shut down in the short run, but resume producing in the long run. the firm should continue producing in the short run, but exit the market in the long run. the firm is earning positive economic profit. the firm should shut down in the short run and exit the market in the long run. the firm should continue producing in both the short run and the long run.

If the price for a firm's output is greater than the minimum value of its average variable cost, but less than the minimum value of its average total cost, then the firm should shut down in the short run, but resume producing in the long run. the firm should continue producing in the short run, but exit the market in the long run. the firm is earning positive economic profit. the firm should shut down in the short run and exit the market in the long run. the firm should continue producing in both the short run and the long run.

Essentials of Economics (MindTap Course List)

8th Edition

ISBN:9781337091992

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter13: Firms In Competitive Markets

Section: Chapter Questions

Problem 4CQQ

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