General Motors will temporarily idle five U.S.

assembly plants that build sedans and coupes, such as the Chevrolet Cruze, Cadillac CTS, and Chevy Camaro, as American motorists by the millions shift from passenger cars to utility vehicles and other light trucks.

a. Explain how the shutdown decision will affect GM’s TFC, TVC, and TC.

b. Under what conditions would this shutdown decision maximize GM’s economic profit (or minimize its loss)? Explain your answer.

c. Under what conditions will GM start producing the sedans and coupes again? Explain your answer.