Exhibit 8-15 Short-run cost curves for E-Z Care lawn mowing company
-In Exhibit 8-15, suppose the market price of mowing lawns falls to $10 per lawn. In this situation, E-Z-Care will:

Question

Exhibit 8-15 Short-run cost curves for E-Z Care lawn mowing company 
-In Exhibit 8-15, suppose the market price of mowing lawns falls to $10 per lawn. In this situation, E-Z-Care will:

Quizplus · Accepted Answer

In the short run, E-Z-Care should continue to mow lawns despite its economic losses. This is because the company still has some revenue coming in to cover its variable costs, even though it is not making a profit. However, if the market price remains at $10 per lawn in the long run, E-Z-Care may consider permanently exiting the industry.

Exhibit 8-15 Short-Run Cost Curves for E-Z Care Lawn Mowing