A Profit-Maximizing Firm Should Shut Down in the Short Run

question 118

Multiple Choice

A profit-maximizing firm should shut down in the short run if the average revenue it receives is less than

• A) average variable cost.
• B) average total cost.
• C) average fixed cost.
• D) marginal cost.

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Definitions:

Cash Crops

Crops grown for direct sale in the market, as opposed to being grown for the farmer's use or for livestock feed.

Civil War

An internal conflict within a country or nation between factions or regions, often characterized by armed struggle and political instability.

Manufacturing Output

The total value of goods produced by the manufacturing sector of an economy within a specific period.

United States

A country located in North America, consisting of 50 states and a federal district, known for its significant influence on global politics, economy, and culture.