A firm sells 1000 units per week. It charges $15 per unit, the average variable costs are $10, and the average costs are $25. In the short run, the firm should

a). Shut-down as the firm is making a loss of $10,000 per week
b). Shut-down is the price is lower than average cost
c). Continue operating as the firm is covering all the variable costs and some of the fixed costs
d). Shut-down because it is cost-effective to pay off the remaining fixed costs

Answer rating: 100% (QA)

The correct answer is c The firm should continue operating as ... View the full answer