Refer to the information provided in Figure 9.3 below to answer the question(s) that follow. Figure 9.3
-Refer to Figure 9.3. This firm will continue to operate in the short run, but incur an economic loss if price is
A) between $0 and $4.
B) between $4 and $7.
C) between $7 and $13.
D) above $13.

Question

Refer to the information provided in Figure 9.3 below to answer the question(s) that follow.  Figure 9.3
-Refer to Figure 9.3. This firm will continue to operate in the short run, but incur an economic loss if price is
A) between $0 and $4. 
B) between $4 and $7. 
C) between $7 and $13. 
D) above $13.

Quizplus · Accepted Answer

In the short run, a firm will continue to operate as long as it can cover its variable costs, even if it's incurring an economic loss. This is because shutting down would mean not covering any fixed costs, leading to a larger loss. The price range between $7 and $13 indicates that the firm covers its variable costs but not its total costs (including fixed costs), leading to an economic loss. However, it's still more beneficial to operate than to shut down in this scenario.

Refer to the Information Provided in Figure 9