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MariettaO [177]
3 years ago
5

If a perfectly competitive firm finds that price is less than average variable cost, it should: shut down immediately. increase

output until price equals marginal cost. decrease output until price equals marginal cost. not adjust output if marginal cost equals price.
Business
1 answer:
Musya8 [376]3 years ago
4 0

Answer: It should shot down immediately.

Explanation:

If the market price is equal to average cost at the profit-maximizing level of output, then the firm is making zero profits. If the market price that a perfectly competitive firm faces is below average variable cost at the profit-maximizing quantity of output, then the firm should shut down operations immediately.

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