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When do firms decide to shut down production in the short run? Explain it. How is the short-run average cost curve and the long-run average cost curve-shaped? What is the difference between them?

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter7: Production, Costs, And Industry Structure

Section: Chapter Questions

Problem 35CTQ: It is clear that businesses operate in the short run, but do they ever operate in the long run?...

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When do firms decide to shut down production in the short run? Explain it.
How is the short-run average cost curve and the long-run average cost curve-shaped? What is the difference between them?

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