Question

• In the short run, when should a firm continue with production according to the shut down rule. A. average revenue (AR) is less than average cost (AC), and average cost (AC) is less than average variable cost (AVC).
•  B. average revenue (AR) is greater than average cost (AC).
•  C. average revenue (AR) is equal to, or greater than, average variable cost (AVC).
•  D. marginal revenue (MR) is greater than marginal cost (MC).

Answer 1

D. marginal revenue (MR) is greater than marginal cost (MC).