Question

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text alternative
multiple choice question
this graph illustrates that a firm can minimize its losses by producing where _______.
o price exceeds minimum average total cost but is less than average fixed cost
o price equals minimum average variable cost but is less than minimum average total cost
o price exceeds minimum average variable cost but is less than marginal cost
o price exceeds minimum average variable cost but is less than average total cost

Explanation:

In a competitive - market situation, a firm will minimize losses in the short - run when price exceeds minimum average variable cost (AVC) but is less than average total cost (ATC). If price is below AVC, the firm will shut down in the short - run. If price is above ATC, the firm makes a profit.

Answer:

price exceeds minimum average variable cost but is less than average total cost