Answer to Question #226777 in Economics for Pabi

Question

A profit-maximising firm sells its product for R300, but continues to produce even though it is making a loss. This suggests that

A. the average fixed cost is less than the price.

B. the average total cost is less than the price.

C. the average variable cost is less than the price.

D. the marginal cost is less than the price.

Answer 1

B. the average total cost is less than the price.