In the short run a firm should recover fixed costs and some portion of overhead rather than undergo a significant decline in business.

Name: In the short run a firm should recover fixed costs and some portion of overhead rather than undergo a significant decline in business.
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Question

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In the short run, a firm should cover its variable costs. Fixed costs are incurred regardless of the level of production, so the focus should be on covering variable costs to avoid losses on each unit produced.

In the Short Run a Firm Should Recover Fixed Costs