During the summer, Alex runs a mowing service, and lawn mowing is a perfectly competitive industry. In the short run, Alex will shut down if:

Question

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In the short run, a firm in a perfectly competitive market will shut down if the total revenues can't cover the variable costs, as it cannot cover the costs of production. Fixed costs are sunk in the short run and do not affect the shutdown decision.

During the Summer, Alex Runs a Mowing Service, and Lawn