Business, 12.12.2019 00:31 batmannn1516

Mrs. smith is operating a firm in a competitive market. the market price is $6.50. at her profit-maximizing level of output, her average total cost of production is $7.00, and her average variable cost of production is $6.00. which of the following statements about mrs. smith’s firm is correct?
a. mrs. smith is earning a loss and should shut down in the short run.
b. mrs. smith is earning a loss but should continue to operate in the short run.
c. mrs. smith is earning a profit since the price is above the average variable cost.
d. without knowing mrs. smith's marginal cost, we cannot determine whether she should stay in business or shut down.

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Mrs. smith is operating a firm in a competitive market. the market price is $6.50. at her profit-max...