At the point at which P=MC, suppose that a perfectly competitive firm’
At the point at which P=MC, suppose that a perfectly competitive firm’s MC = $100, its AVC = $80 and its AC = $110. This firm should
A) shut down immediately.
B) continue operating in the short run.
C) try to take advantage of economies of scale.
D) try to increase its advertising and promotion.
ANSWER
B
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