-In the above figure, if the market price is $8, the firm

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Without a specific figure provided, we generally consider that if a firm's market price covers its average variable costs but not its total costs, it will continue to produce in the short run to cover some of its fixed costs, even though it incurs an economic loss. This is because shutting down would mean a loss equal to all fixed costs, whereas continuing production allows the firm to cover at least some fixed and variable costs.

-In the Above Figure, If the Market Price Is $8