A perfectly competitive firm's ________ point is the lowest point on its AVC curve.
A) profit-maximizing
B) break-even
C) shut down
D) loss-maximizing

Question

Quizplus · Accepted Answer

The shut down point for a perfectly competitive firm is the lowest point on its average variable cost (AVC) curve because if the market price falls below this point, the firm cannot cover its variable costs and would minimize its losses by shutting down production.

A Perfectly Competitive Firm's ________ Point Is the Lowest Point