Suppose a price taker is collecting $1,700 in total revenue and the total cost of its variable factors of production is $1,900 at its current level of output.One can predict that the firm will

Question

Quizplus · Accepted Answer

The firm should shut down because its total revenue ($1,700) is less than its total variable costs ($1,900), meaning it cannot cover its variable costs and is incurring a loss by operating.

Suppose a Price Taker Is Collecting $1,700 in Total Revenue