A monopolist will shut down when _____ in the long run and when _____ in the short run. A) P ATC; P = ATC B) P AVC C) P = ATC; P

Question

A monopolist will shut down when _____ in the long run and when _____ in the short run. A) P > ATC; P = ATC B) P < ATC; P > AVC C) P = ATC; P < ATC D) P < ATC; P < AVC

Quizplus · Accepted Answer

In the long run, a monopolist will shut down if the price (P) is less than average total cost (ATC), indicating they cannot cover all their costs. In the short run, they will shut down if the price is less than average variable cost (AVC), as they cannot even cover their variable costs.

A Monopolist Will Shut Down When _____ in the Long