In the Long Run If the Price Is Below Average

question 142

Multiple Choice

In the long run if the price is below average total cost,the firm will

• A)go out of business.
• B)stay in business.
• C)temporarily shut down.
• D)None of the choices are correct.

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Definitions:

Accounts Payable

Liabilities or amounts owed by a company to suppliers for goods and services received but not yet paid for.

Inventory

The total amount of goods and materials held by a company, intended for sale or production.

Investing Transactions

Activities related to the acquisition or disposal of long-term assets and investments not included in cash equivalents within a company.

Cash Flow Statement

A financial statement that shows how changes in balance sheet accounts and income affect cash and cash equivalents.