A firm sell logo face masks at a price of $10.00 per unit. It has an average variable cost of $8.00 and an average fixed cost of $4.00 per unit.

In the short run, this firm is

a.losing$2.00 per unit and should shut down.

b.unable to cover its fixed cost and hence should shut down.

c.losing$2.00per unit, but since it can still cover its variable costs, should continue to operate

d.earning a profit of $2.00 per unit and should continue to operate.