If a perfectly competitive firm in the short run is able to pay its variable costs and part,but not all,of its fixed costs,then it is operating in the range on its marginal cost curve that is anywhere

Question

Quizplus · Accepted Answer

If the firm is able to pay its variable costs and part of its fixed costs but not all of them, it means that it is generating revenue that exceeds the variable costs but not enough to cover all the fixed costs as well. This puts the firm in a position where it is better off producing than shutting down, but it is not yet making a profit. This situation occurs between the shutdown point (where the firm would be better off shutting down than continuing to produce) and the break-even point (where the firm covers all of its costs and makes no profit). Therefore, the correct answer is E, between the shutdown and break-even points.

If a Perfectly Competitive Firm in the Short Run Is