Suppose that when a firm produces the level of output at which price equals marginal cost, the firm's total revenue is less than its variable cost. In this case, the firm should:

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aloonzogouldsr6400 aloonzogouldsr6400

18-07-2022
Business

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Suppose that when a firm produces the level of output at which price equals marginal cost, the firm's total revenue is less than its variable cost. In this case, the firm should:

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topeadeniran2 topeadeniran2 · Answer 1 · 2022-07-19T16:54:31+02:00

When the firm's total revenue is less than its variable cost, the firm should shut down temporarily.

What is total revenue?

It should be noted that the total revenue simply means the total amount that's generated from the sales of goods and services.

In this base, when the firm's total revenue is less than its variable cost, the firm should shut down temporarily as it's not profitable to continue producing.

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