If a firm can sell a product, but in order to sell that product the selling price will be less than its variable costs, then the sale should be made because at least the fixed costs will be covered.

Question

Quizplus · Accepted Answer

Selling a product at a price below its variable costs means the firm would not cover the variable costs and would incur a greater loss, as fixed costs are unaffected by the volume of production or sales.

If a Firm Can Sell a Product, but in Order