Question

9:39 ill LTE 1 < Back Assignment #7 Question 7 Not yet answered Points out of 1.00 Which of the following best states why why in the short run a firm may decide to continue to produce, even with economic losses? Select one: a. Price is greater than average variable cost but less tha average total cost. b. Total revenue is greater than total variable cost but less than total cost. c. All of the above are reasons for continuing production. d. One of the above is incorrect. e. Economic losses areless than fixed cost. Clear my choice < Previous Next >

Answer 1

C Continuation of production happens when there is a situation where the price is greater than avg. variable cost but less than avg total cost and which also means total revenue is greater than variable cost but less than fixed costs

Because if he does not produce he incurs fixed costs and if he produces he would incur less than fixed costs.