Question: Should a firm shut down if its revenue is R
Should a firm shut down if its revenue is R = $ 1,000 per week, a. Its variable cost is VC = $ 500, and its sunk fixed cost is F = $ 600? b. Its variable cost is VC = $ 1,001, and its sunk fixed cost F = $ 500? c. Its variable cost is VC = $ 500 and its fixed cost is $ 800, of which $ 600 is avoidable if it shuts down?
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