2022 June Business Economics and Business and Commercial Knowledge

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Question : 46 of 100

Marks: +1, -0

Suppose that, at the profit-maximizing level of output, a firm finds that market price is less than average total cost, but greater than average variable cost. Which of the following statements is correct?

The firm should shutdown in order to minimise its losses.
The firm should raise its price enough to cover its losses.
The firm should move its resources to another industry.
The firm should continue to operate in the short run in order to minimize its losses.

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