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In the Short Run, If a Firm Shuts Down It

question 162

True/False

In the short run, if a firm shuts down it avoids its variable cost but not its fixed cost.


Definitions:

Barriers

Obstacles or impediments that prevent or hinder progress, such as trade barriers which can restrict the flow of goods between countries.

Control Over Price

The ability of a company or market to influence or set the price of goods and services.

Product Differentiation

The process of distinguishing a product or service from others, to make it more attractive to a particular target market.

Total Market

The entirety of the demand and supply for a particular good or service across all its potential markets.

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