If a Firm Operating in a Competitive Industry Shuts Down

question 505

Multiple Choice

If a firm operating in a competitive industry shuts down in the short run, it can avoid paying

• A)fixed costs.
• B)variable costs.
• C)total costs.
• D)The firm must pay all its costs, even if it shuts down.

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Definitions:

Binomial Parameters

Refer to the number of trials (n) and the probability of success (p) in a binomial distribution, which determines the behavior of this discrete probability distribution.

Alternative Hypothesis

In statistical hypothesis testing, a statement that contradicts the null hypothesis, suggesting that there is a statistically significant difference between observed data and the expected outcome under the null hypothesis.

Two-tail Test

A statistical test in which the critical area of a distribution is two-sided and tests whether a sample is either greater than or less than a range of values.

Nominal Data

Data that represents categories with labels or names, where the order of the categories is not meaningful.