Question: When a perfectly competitive firm decides to shut down, it is most likely that a. marginal cost is above average variable cost. b.marginal cost

When a perfectly competitive firm decides to shut down, it is most likely that a. marginal cost is above average variable cost. b.marginal cost is above the average total cost. c. price is below the firm's average variable cost. d. fixed costs exceed variable costs.

Step by Step Solution

★★★★★

3.39 Rating (161 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock

The detailed answer for the above question is provided below An... View full answer

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Economics Questions!

Before starting EM7.1, verify that QBO Inventory Tracking is turned on. Go to Gear icon > Account and Settings > Sales > Products and Services > Track quantity and price/rate On > Track inventory...

How should a retailer respond to the findings of worker engagement being associated with immediate supervisors who are supportive and that recognize the accomplishment of employees?

How should management respond to the findings of an audit? What may happen if the findings are ignored?

Countries showing strong uncertainty avoidance such as France, Germany, and Italy have witnessed a rise in the consumption of mineral water since 1970. In fact, according to one study, the...

estion 3 continued) The graph below illustrates the average total cost and average variable cost information for a firm. On the graph, identify the break-even price and the shut-down price for a...

A.. 1) As new firms enter a monopolistically competitive industry, it can be expected that: a.Profits of existing firms will fall. b.Market price will rise. c.Market demand will rise. d.The profits...

4. What is the relationship between the market price and marginal cost when a perfectly competitive firm is maximizing its profit?

1.1. When a perfectly competitive firm employs one worker, it produces 20 units of output, and when it employs two workers, it produces 39 units of output. The firm sells its product for $10 per...

When a perfectly competitive firm is in long-run equilibrium, we know that it is doing all of the following except a. facing a horizontal demand curve. b. producing where MR MC. c. producing where P...

2. Compare the elasticity of a monopolistic competitors demand with that of a perfectly competitive firm and a monopolist. Assuming identical long-run costs, compare graphically the prices and...

How does a competitive firm determine its profit-maximizing level of output? Explain when does a profit-maximizing competitive firm decide to shut down? When does it decide to exit a market?

The output gas mixture of a certain air-blown coal gasifier has the composition of producer gas as listed in Table 14.2. Consider the combustion of this gas with 120% theoretical air at 14.7 lbf/in2...

Intellectual property is any unique product of the human intellect that has commercial value. Computing professionals are obligated to protect the integrity of the intellectual property. (a) Explain...

Exercise 1 - 4 A ( Static ) Define terms and identify missing information in the accounting equation LO 1 - 3

A. From what group must the terminal atoms come in an ABx molecule where the central atom is from group 6A, for the electron-domain geometry and the molecular geometry both to be trigonal planar?...

Prelaboratory Assignment I. Give the step-by-step procedures that you will use for the following tasks: a. Measuring the density of the metals b. Measuring the heat of fusion of ice

The writing assignment involves a critical analysis of a recent article (3 to 6) pages long from a professional accounting journal (e.g. The Journal of Accountancy, Accounting Horizons, CPA Journal,...

Complete the remaining sections of the Exceptionality Chart, using information found in the Kirk, et al text and other credible sources. The completed sections are there for review, as well as to set...

Topic: Creating an Email Policy Template using the SANS email policy template Information security uses administrative, technical (logical), and physical controls to mitigate risks related to...

What are some of Buckminister Fuller's dymaxion inventions or designs? (Select all that apply) Group of answer choices Dymaxion Kitchen Dymaxion Deployment Units Dymaxion Bathroom Dymaxion Car...

Multiple Choice Questions 1. Jen values her time at $60 an hour. She spends 2 hours giving Colleen a massage. Colleen was willing to pay as much at $300 for the massage, but they negotiate a price of...

Multiple Choice Questions 1. The two largest sources of tax revenue for the U.S. federal government are a. Individual and corporate income taxes. b. Individual income taxes and payroll taxes for...

Multiple Choice Questions 1. The money supply includes all of the following EXCEPT a. Metal coins. b. Paper currency. c. Lines of credit accessible with credit cards. d. Bank balances accessible with...

7.25. For the 2004 GSS, Table 7.15 shows software output for evaluating the number of hours of TV watching per day by race. TABLE 7.15 Race N Mean StDev SE Mean Black 101 4.09 3.63 0.3616 White 724...

7.24. For the 2006 GSS, a comparison of females and males on the number of hours a day that the subject watched TV gave: Group N Mean StDev SE Mean Females 1117 2.99 2.34 0.070 Males 870 2.86 2.22...

7.29. Refer to the previous exercise. For comparing partics and sports, software reports a 95% confidence interval of (-3.33,28.93) and a P-value of 0.106. (a) Interpret the P-value. (b) Explain the...