When price does not cover average total cost at any rate of output,the firm should shut down in the short run.

Name: When price does not cover average total cost at any rate of output,the firm should shut down in the short run.
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Question

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In the short run, a firm should continue to operate as long as price covers average variable costs, even if it does not cover average total costs, because it can still cover some of its fixed costs.

When Price Does Not Cover Average Total Cost at Any