If a firm shuts down in the short run, its maximum loss equals the amount of its fixed cost.

Name: If a firm shuts down in the short run, its maximum loss equals the amount of its fixed cost.
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In the short run, a firm's variable costs can be avoided by shutting down, but its fixed costs are unavoidable. Therefore, if a firm shuts down in the short run, its loss will equal its fixed costs.

If a Firm Shuts Down in the Short Run, Its