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Author Question: If revenue in the short run is less than variable costs, what should the firm do?? What will be ... (Read 41 times)

altibaby

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on: Jun 29, 2018
If revenue in the short run is less than variable costs, what should the firm do??
 
  What will be an ideal response?

Question 2

What does it mean if an industry has external economies?
 
  What will be an ideal response?


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sarahccccc

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Reply #1 on: Jun 29, 2018
Answer to Question 1

The firm should shut down to minimize losses (i.e., loss equal to fixed costs only).

Answer to Question 2

There are external economies in an industry if long-run average costs fall as the size of the industry increases.


altibaby

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Reply 2 on: Jun 29, 2018
YES! Correct, THANKS for helping me on my review

DylanD1323

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Reply 3 on: Yesterday
Wow, this really help

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