A firm will go out of business if the price is below: A. marginal cost B. marginal revenue C....
Question:
A firm will go out of business if the price is below:
A. marginal cost
B. marginal revenue
C. average total cost
D. average fixed cost
Out of Business:
In economics, the firm is said to be out of business when the firm exits the market. Moreover, such a situation occurs when the firm receives an economic profit of less than zero and running the business in the respective market conditions is no longer profitable.
Answer and Explanation: 1
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View this answerThe correct option is Option (c).
The price below the average total cost implicates that the firm is experiencing an economic loss selling its...
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Economic Loss: Definition & Rule
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Chapter 3 / Lesson 35
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Learn the definition of economic loss. Discover the difference between pure economic loss and consequential economic loss with explanations and example scenarios.
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