When Total Revenue Is Less Than Variable Costs, a Firm

question 49

Multiple Choice

When total revenue is less than variable costs, a firm in a competitive market will

• A)continue to operate as long as average revenue exceeds marginal cost.
• B)continue to operate as long as average revenue exceeds average fixed cost.
• C)shut down.
• D)raise its price.

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Definitions:

Agenda Setting

A communication theory that suggests the media has the power to determine which issues are considered important by the public.

Media

Means of mass communication, including newspapers, television, radio, and the internet, that disseminate information or entertainment to a wide audience.

Issues

Important topics or problems for debate or discussion.

Voter Turnout

The percentage of eligible voters who cast a ballot in an election, indicating the level of public participation in the democratic process.