If a Firm Shuts Down in the Short Run and Produces

question 114

Multiple Choice

If a firm shuts down in the short run and produces no output,its total cost will be _____

• A)equal to zero.
• B)equal to the variable cost.
• C)equal to the fixed cost.
• D)equal to only explicit costs.
• E)equal to the sum of implicit and explicit costs.

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Definitions:

Interest Rate

The rate at which a borrower is charged interest for the money borrowed from a lender.

Cash Rebate

A partial refund to someone who has paid too much money for tax, rent, or a utility, or as a promotional incentive from the purchase of goods or services.

Effective Rate

The actual interest rate earned or paid on an investment, loan, or savings account, taking into account the effect of compounding.

Annuitant

The individual who receives the benefits or payments from an annuity plan.