A producer is considering production of mattresses. Following are the costs they face: Fixed costs of factory and equipment (these are contract bound): $400,000. Cost of salary given up as a manager elsewhere (you can't get this job mid-year): $100,000. The factory produces 1,000 mattresses. The variable costs of production are $700,000. Assume the producer decides to go into this business when the market price per mattress is $1,200, and after they make the decision, the price drops to $400 (assume they sell 1,000 mattresses). Which of the following is true? The firm is making positive accounting profits and should continue production in the short run The firm is making negative accounting profits but should continue production in the short run The firm is making negative accounting profits and should shut down in the short run The firm is making positive accounting profits but should shut down in the short run