If the Price of a Product Is $12, Its Average

question 67

Multiple Choice

If the price of a product is $12, its average total cost is $2 and its average total cost is $15 at the profit-maximizing output level,  in the short run the firm:

• A) should expand output until MR = MC.
• B) cannot cover total fixed costs.
• C) experiences a loss.
• D) must always shut down.

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