Acme Dynamite has $2000 of variable costs and $500 of fixed costs when its output is 250 units.It sells each unit for $25.
If the price of dynamite drops to $10,should Acme continue to operate in the short run?
A) No,because Price is less than Average Total Cost
B) Yes,because Price is less than Average Variable Cost
C) No,because Price is not greater than Average Total Cost
D) Yes,because Price is greater than Average Variable Cost
Correct Answer:
Verified
Q63: Average variable cost is defined as
A)Total cost
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Q65: Acme Dynamite has $2000 of variable costs
Q66: Acme Dynamite has $2000 of variable costs
Q67: The shutdown condition applies
A)in the long run
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Q70: Acme Dynamite has $2000 of variable costs
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Q73: A profit-maximizing firm will shut down when:
A)total
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