Suppose you as a business person find that the price of your product is less than minimum average variable cost (AVC). In this case, you should: A) Minimize your losses by producing where P = MC B) Maximize your profits by producing where P = ATC C) Close down because, by producing, your losses will exceed your total fixed costs D) Close down because your total revenue exceeds your total variable costs

Suppose you as a business person find that the price of your product is less than minimum average variable cost (AVC). In this case, you should: A) Minimize your losses by producing where P = MC B) Maximize your profits by producing where P = ATC C) Close down because, by producing, your losses will exceed your total fixed costs D) Close down because your total revenue exceeds your total variable costs

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter11: Profit Maximization

Section: Chapter Questions

Problem 11.9P

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