A Firm Finds That at Its MR = MC Output

question 157

Multiple Choice

A firm finds that at its MR = MC output, its TC = $1,000, TVC = $800, TFC = $200, and total revenue is $900. This firm should

• A) shut down in the short run.
• B) produce because the resulting loss is less than its TFC.
• C) produce because it will realize an economic profit.
• D) liquidate its assets and go out of business.

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