Staples Closing Another $70$ Stores as North American Sales Sink

Staples closed $48$ of its North American stores in $2016$ and will close another $70$ in $2017.$ The firm has expanded its$$ e$-$commerce, and has focused on buying small$$ business$-$to$-$business service providers beyond office supplies companies that employ $10$ to $200$ employees. It has added$1,000$ people to its sales force.

$$Source: Fortune$,$ March$9,2017$

Explain how$$ Staples' short$-$run decision will change its average variable cost and its$$ short$-$run ATC curve.

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Part $1$

$$Staples$\text{'}$ short$-$run decision of hiring more workers$\_\_\_\_\_\_\_.$

A$.$

creates a movement along its average total cost and average variable cost curves but without information about relative changes in cost and$$ output, the change in average total cost and average variable cost cannot be predicted

B$.$

decreases average total cost and average variable cost and shifts both curves downward because an increase in the number of workers increases efficiency

C$.$

creates a movement rightward along the$$ downward$-$sloping portions of the average total cost and average variable cost curves and decreases average total cost and average variable cost

D$.$

increases average total cost and average variable cost and shifts both curves upward because an increase in the number of workers increases total variable cost and total cost