When a firm makes a short-run decision not to produce anything during a specified period of time because of current market conditions,what is the firm said to do

Question

Quizplus · Accepted Answer

Shut down refers to a short-run decision made by a firm to temporarily cease production due to current market conditions. This is different from exiting the market or leaving the industry, which implies a permanent decision to cease operations. Withdrawing may also imply a permanent decision, whereas shut down is a temporary measure. Therefore, the best choice is A) shut down.

When a Firm Makes a Short-Run Decision Not to Produce