n the short run, if a supplier faces a price that is less than their average total cost (ATC) but above their average variable cost (AVC)the supplier should continue to operate to minimise losses.the supplier should increase quantity until marginal cost is equal to average total cost.the supplier should shut down.None of the above.

The marginal cost (MC) curve of a supplier in a competitive market will intersect the average variable cost (AVC) curveas the AVC is decreasing.at the AVC's minimum point.as the AVC is increasing.None of the above.

The average variable cost (AVC), average cost (AC) and marginal cost (MC) are ______ indicating that they start at high value, decline at decreasing rate and then at increasing rate. A. L-Shaped B. U-Shaped C. V-shaped D. W-Shaped

The vertical distance between ATC and AVC reflects:The graph shows the Marginal cost, Average Total cost, Average variable cost, and Average Fixed Costs.Multiple Choicethe law of diminishing returns.the average fixed cost at each level of output.marginal cost at each level of output.the presence of economies of scale.

The short-run marginal and average variable cost curves for a competitive firm are given by MC = 2+2q and AVC = 2+q. The profit-maximizing level of output for a firm is 4 and its total fixed cost is $18. Which of the following must be true about the firm? Group of answer choices The firm is charging a price of $4 and covering its average variable cost, hence it should continue operating in the short-run. The firm is charging $10 and will remain in the industry in the short-run; but it is not covering its total costs and will consider leaving the industry in the long run. The firm is charging a price of $4 and making a short-run loss, hence it should shut down immediately. The firm is charging a price of $10 and making a zero profit, hence it should shut down eventually. The firm is charging a price of $10 and making a positive profit, hence it will remain in the industry in the long-run.

If a competitive firm finds that it maximises short-run profits by shutting down, which of the following must be true?Group of answer choicesp < AVC for all levels of output.p < AVC only for the level of output at which p = MC.p < AVC only if the firm has no fixed costs.The firm will earn zero profit.