Exhibit 8-3 Cost Per Unit Curves

question 6

Multiple Choice

Exhibit 8-3 Cost per unit curves

If the price of the firm's product in Exhibit 8-3 is $1.50 per unit, which intersects AVC at point B, the firm should:

• A) continue to operate because it is earning a positive economic profit.
• B) stay in operation for the time being even though it is making an economic loss.
• C) shut down temporarily.
• D) increase the price.

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Definitions:

Catecholamines

Hormones made by the adrenal glands, such as adrenaline and noradrenaline, which are involved in the body's stress response.

Norepinephrine

A hormone and neurotransmitter involved in the body's fight or flight response, regulating heart rate and blood pressure among other functions.

Epinephrine

A hormone and neurotransmitter also known as adrenaline that increases heart rate, muscle strength, blood pressure, and sugar metabolism.

Homeostasis

The physiological process by which living organisms maintain stability in their internal environment despite changes in external conditions.