When Total Revenue Is Less Than Variable Costs, a Firm

question 49

Multiple Choice

When total revenue is less than variable costs, a firm in a competitive market will

• A)continue to operate as long as average revenue exceeds marginal cost.
• B)continue to operate as long as average revenue exceeds average fixed cost.
• C)shut down.
• D)raise its price.

---

Definitions:

Poverty Line

The minimum level of income deemed necessary to achieve an adequate standard of living in a given country.

Public Assistance Grant

Financial aid provided by the government to individuals or groups in need, aimed at supporting basic living expenses.

Family

A social unit consisting of individuals related by blood, marriage, or adoption, often forming a household.

Poverty Rate

The percentage of the population with incomes below the official poverty line established by the federal government.