Figure 8.4.3
-Refer to Figure 8.4.3 above. The firm in this situation should decide to:

Question

Quizplus · Accepted Answer

In the context of economics, if a firm's total revenue covers its variable costs but not its total costs, it should continue to produce in the short run to minimize losses. Shutting down would mean not covering any fixed costs, while producing at a loss allows the firm to cover some fixed costs, reducing overall losses. Choices A, C, and D do not accurately reflect this principle without additional context from Figure 8.4.3.

Figure 8.4.3 -Refer to Figure 8.4.3 Above. the Firm in This Situation