A firm sets its price at $10.00 per unit.It has an average variable cost of $8.00 and an average fixed cost of $4.00 per unit.In the long run,this firm is
A)earning zero profits and hence should shut down.
B)unable to cover all of its fixed cost and hence should shut down.
C)incurring a profit.
D)incurring a loss per unit of $2.00,but since it can still cover its variable costs,should continue to operate.

Question

​A firm sets its price at $10.00 per unit.It has an average variable cost of $8.00 and an average fixed cost of $4.00 per unit.In the long run,this firm is
A)​earning zero profits and hence should shut down.
B)unable to cover all of its fixed cost and hence should shut down.
C)incurring a profit.
D)​incurring a loss per unit of $2.00,but since it can still cover its variable costs,should continue to operate.

Quizplus · Accepted Answer

The Answer of ​A firm sets its price at $10.00 per unit.It has an average variable cost of $8.00 and an average fixed cost of $4.00 per unit.In the long run,this firm is
A)​earning zero profits and hence should shut down.
B)unable to cover all of its fixed cost and hence should shut down.
C)incurring a profit.
D)​incurring a loss per unit of $2.00,but since it can still cover its variable costs,should continue to operate.

​A Firm Sets Its Price at $10

A Firm Sets Its Price at $10