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Author Question: The owner of Tie-Dyed T-shirts, a perfectly competitive firm, has hired you to give him some ... (Read 97 times)

sabina

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on: Apr 19, 2019

The owner of Tie-Dyed T-shirts, a perfectly competitive firm, has hired you to give him some economic advice. He has told you that the market price for his shirts is $20 and that he is currently producing 200 shirts at an 
AVC of $15 and an 
ATC of $25. What would you recommend to him?


◦ To continue producing in the short run, as his loss from production is less than his fixed costs, but to exit the industry in the long run if there are no changes in economic conditions.
◦ To shut down in the short run, as he is incurring a loss, and to leave the industry in the long run, if there are no changes in economic conditions.
◦ To continue to produce in the short run, even though he is earning a loss, and to expand in the future with the hope of increasing market share and total revenue.
◦ You tell him you cannot make any recommendations until you know what his fixed costs are.
Principles of Economics ¦ Case, Fair, Oster ¦ 12th Edition
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Marked as best answer by sabina on Apr 19, 2019

mirabriestensky

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Reply #1 on: Apr 19, 2019
Lorsum iprem. Lorsus sur ipci. Lorsem sur iprem. Lorsum sur ipdi, lorsem sur ipci. Lorsum sur iprium, valum sur ipci et, vala sur ipci. Lorsem sur ipci, lorsa sur iprem. Valus sur ipdi. Lorsus sur iprium nunc, valem sur iprium. Valem sur ipdi. Lorsa sur iprium. Lorsum sur iprium. Valem sur ipdi. Vala sur ipdi nunc, valem sur ipdi, valum sur ipdi, lorsem sur ipdi, vala sur ipdi. Valem sur iprem nunc, lorsa sur iprium. Valum sur ipdi et, lorsus sur ipci. Valem sur iprem. Valem sur ipci. Lorsa sur iprium. Lorsem sur ipci, valus sur iprem. Lorsem sur iprem nunc, valus sur iprium.
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sabina

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Reply 2 on: Apr 19, 2019
Great answer, keep it coming :)

amandalm

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Reply 3 on: Yesterday
Wow, this really help

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