In the short-run for a purely competitive market,a manufacturer will stop production when:

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Quizplus · Accepted Answer

In the short-run, a manufacturer in a purely competitive market will stop production when the contribution to fixed costs is zero or less. This means that the price they are receiving for their product is not even covering the variable costs of production. If they continue producing, they will incur losses on their fixed costs as well, leading to even greater losses. Therefore, it is best to shut down production temporarily until the price of the product improves.

In the Short-Run for a Purely Competitive Market,a Manufacturer Will