(Mankiw page 296,Quick Check Multiple Choices,4) If a profit-maximizing, competi
ID: 1107212 • Letter: #
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(Mankiw page 296,Quick Check Multiple Choices,4) If a profit-maximizing, competitive firm is pro- ducing a quantity at which marginal cost is between average variable cost and average total cost, it will.... A. keep producing in the short run but exit the market in the long run. B. shut down in the short run but return to production in the long run. C. shut down in the short run and exit the market in the long run. D. keep producing both in the short run and in the long run. (Mankiw page 296,Quick Check Multiple Choices,4) If a profit-maximizing, competitive firm is pro- ducing a quantity at which marginal cost is between average variable cost and average total cost, it will.... A. keep producing in the short run but exit the market in the long run. B. shut down in the short run but return to production in the long run. C. shut down in the short run and exit the market in the long run. D. keep producing both in the short run and in the long run. (Mankiw page 296,Quick Check Multiple Choices,4) If a profit-maximizing, competitive firm is pro- ducing a quantity at which marginal cost is between average variable cost and average total cost, it will.... A. keep producing in the short run but exit the market in the long run. B. shut down in the short run but return to production in the long run. C. shut down in the short run and exit the market in the long run. D. keep producing both in the short run and in the long run. B. shut down in the short run but return to production in the long run. C. shut down in the short run and exit the market in the long run. D. keep producing both in the short run and in the long run.Explanation / Answer
A. It will keep producing in he short run but exit the market in the long run.
Firms will keep produsing in the short run but will exit in the long run. This is due to reduciton in production and losses.
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