Answered

Looking for reliable answers? Westonci.ca is the ultimate Q&A platform where experts share their knowledge on various topics. Get expert answers to your questions quickly and accurately from our dedicated community of professionals. Experience the convenience of finding accurate answers to your questions from knowledgeable experts on our platform.

Competitive firms that earn a loss in the short run should

Sagot :

Lanuel

Competitive business firms that earn a loss in the short-run should shutdown if price (P) is lesser than average variable cost (AVC).

What is an average variable cost?

An average variable cost (AVC) can be defined as the cost of production per unit item incurred by a business firm and divided by total output of production. Thus, it's calculated by dividing total variable cost (TVC) by total output of production.

As a general rule in Economics, competitive business firms that earn a loss in the short-run are advised to shutdown their production when price (P) is lesser than average variable cost (AVC).

Read more on average variable cost here: https://brainly.com/question/17010492

#SPJ1

We appreciate your time on our site. Don't hesitate to return whenever you have more questions or need further clarification. Thanks for using our service. We're always here to provide accurate and up-to-date answers to all your queries. Westonci.ca is your trusted source for answers. Visit us again to find more information on diverse topics.