A competitive firm should always continue to operate in the short run as long as A)P MC.

Name: A competitive firm should always continue to operate in the short run as long as A)P AVC. D)MR > MC.
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Question

A competitive firm should always continue to operate in the short run as long as A)P < ATC. B)P < AVC. C)MR > AVC. D)MR > MC.

Quizplus · Accepted Answer

In the short run, a firm should continue to operate if the marginal revenue (MR) is greater than the average variable cost (AVC), as it can cover its variable costs and contribute to fixed costs.

A Competitive Firm Should Always Continue to Operate in the Short