When price exceeds average variable cost but not average total cost, the firm should, in the short run, Minimize per-unit losses by producing at the rate of output where ATC is minimized in the short run. Shut down. Minimize total losses by producing at the rate of output where ATC is minimized. Produce at the rate of output where MR = MC.

When price exceeds average variable cost but not average total cost, the firm should, in the short run, Minimize per-unit losses by producing at the rate of output where ATC is minimized in the short run. Shut down. Minimize total losses by producing at the rate of output where ATC is minimized. Produce at the rate of output where MR = MC.

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter2: Mathematics For Microeconomics

Section: Chapter Questions

Problem 2.2P

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