Exhibit 8-6
-Consider Exhibit 8-6. At which price will this firm shut-down?

Name: Exhibit 8-6 -Consider Exhibit 8-6. At which price will this firm shut-down?
Brand: Quizplus
Rating: 4.8 (53 reviews)

Question

Exhibit 8-6 
-Consider Exhibit 8-6. At which price will this firm shut-down?

Quizplus · Accepted Answer

At P₃, the average variable cost (AVC) is equal to the price. At this point, the firm is not making any profit but is covering its variable costs. Any price lower than this, the firm will not be able to cover its variable costs and will shut-down.

Exhibit 8-6 -Consider Exhibit 8-6. at Which Price Will This Firm Shut-Down