Suppose That,in Running Your Business,you Find That the Price of Your

question 44

Multiple Choice

Suppose that,in running your business,you find that the price of your product is less than AVC.Given this information you should:

• A)minimize your losses by producing where P = MC
• B)maximize your profits by producing where P = MC
• C)close down because, by producing, your losses will exceed your fixed costs
• D)close down because total revenue exceeds variable costs
• E)close down because total revenue exceeds total cost

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Definitions:

Number of Suppliers

Refers to the total count of distinct suppliers that a company uses or maintains relationships with for procuring goods or services.

Unique-Event Risk

Risk associated with a specific and non-recurring event that can affect the outcome of a project or investment.

Super-Event

A significant occurrence or gathering with a large impact, often exceeding the scale and effects of typical events.

Total Shutdown

A situation where an organization ceases all operations, often due to economic challenges, natural disasters, or strategic decisions.