The owner of Tie-Dyed T-shirts, a perfectly competitive firm, ...

[mp14]

The owner of Tie-Dyed T-shirts, a perfectly competitive firm, hires you to give him economic advice. He tells you that the market price for his shirts is $15 and that he is currently producing 200 shirts at an 
AVC of $10 and an 
ATC of $20. You tell him he should continue to operate in the short run because

◦ he is earning an economic profit of $4,000.
◦ his loss from operating in only $2,000 which is less than his loss if he shuts down.
◦ he has to pay this fixed costs of $2,000 if he shuts down which is greater than his loss when he operates.
◦ In fact you do not tell him to operate—he should shut down since he has a loss.

[atrochim]

A FREE account is required to view all solutions! Click to Register

Login with Facebook Login with Google Login with Email

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.

Answer Preview

Only 29% of students answer this correctly

[mp14]

Thanks

[atrochim]

Welcome