You Are Hired by Jimbo's Potato Farm to Determine When

question 49

Multiple Choice

You are hired by Jimbo's Potato Farm to determine when Jimbo should shut down and produce no potatoes in the short run. Jimbo sells his potatoes in a perfectly competitive market. You tell Jimbo to shut down if

• A) total cost is less than total revenue when marginal revenue equals marginal cost.
• B) price is less than average variable cost when marginal revenue equals marginal cost.
• C) price is less than average total cost when marginal revenue equals marginal cost.
• D) marginal revenue is less than marginal cost.

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