In the long-run, a firm must shut down if its average revenue is

Economics

JAMB 2022

A. greater than average cost
B. less than average variable cost
C. equal to the minimum average revenue is
D. equal to the average cost

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Correct Answer: Option B

Explanation

In the long-run, a firm shut down if its average revenue ( price) is less than average variable cost. A firm shut down, when it is unable to cover its average variable cost or average cost or Average fixed cost is zero(0).

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In the long-run, a firm must shut down if its average revenue is

Correct Answer: Option B

Explanation

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