Question
23.Mrs. Smith operates a business in a competitive market. The current market price is $8.50. At her profit-maximizing level of production, the average variable cost
23.Mrs. Smith operates a business in a competitive market. The current market price is $8.50. At her profit-maximizing level of production, the average variable cost is $8.00, and the average total cost is $8.25. Mrs. Smith should
a.shut down her business in the short run but continue to operate in the long run.
b.continue to operate in the short run but exit the business in the long run.
c.continue to operate in both the short run and long run.
d.shut down in the short run and exit in the long run.
e.it cannot be determined what Mrs. Smith should do without more information.
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