As long as price is sufficient to cover ________, the firm is better off by operating rather than by shutting down.
A) marginal cost
B) average fixed cost
C) average variable cost
D) marginal revenue

Question

Quizplus · Accepted Answer

As long as the price is sufficient to cover the average variable cost, the firm can cover its variable costs and contribute something towards its fixed costs, making it better off operating than shutting down. If it cannot cover its average variable costs, it would lose more by continuing to operate.

As Long as Price Is Sufficient to Cover ________, the Firm