Figure 14-7
-Refer to Figure 14-7. In the long run, the firm will exit the market if the price of the good is
A)$75.
B)$85.
C)$95.
D)All of the above are correct.

Question

Figure 14-7 
-Refer to Figure 14-7. In the long run, the firm will exit the market if the price of the good is
A)$75. 
B)$85. 
C)$95. 
D)All of the above are correct.

Quizplus · Accepted Answer

In the long run, the firm will exit the market if the price of the good is less than the minimum average variable cost. In this case, the minimum average variable cost is $95. Therefore, the firm will exit the market if the price of the good is $95 or less.

Figure 14-7 -Refer to Figure 14-7. in the Long Run, the Firm