A competitive for maximizes profit and an output level of 500 units market price is $24...

A competitive for maximizes profit and an output level of 500 units market price is $24 average total cost is $24 50 cents at what range of average variable cost values for an output level of 500 would the firm choose not to shut down

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Expert Solution

the rage of average varible cost is below $24

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A firm produces at MR=MC if the price is above average varible cost

the firm produces if the AVC is below the price at the output level.

the firm earns losses but produces even at losses to minimize losses if it can cover the variable costs.

Rahul Sunny answered 1 year ago

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