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When the total revenue earned by a firm is less than the total cost of production the firm faces a n quizlet?___ profit is also known as zero economic profit. When the total revenue earned by a firm is less than the total cost of production, the firm faces a loss.
What is your decision when the total revenue is less than the total cost?If total revenue were less than total variable cost, the firm's economic loss would exceed total fixed cost. So the firm would shut down temporarily. Total fixed cost is the largest economic loss that the firm will incur. The firm's economic loss equals total fixed cost when price equals average variable cost.
When the total revenue is than the total cost the level of profit that occurs is a Los?When the total revenue is (one word) than the total cost the level of profit that occurs is a loss. Total revenue minus the implicit and explicit costs of production is profit.
What happens if total cost exceeds total revenue?Suppose the average total cost exceeds the average revenue or the market price in the long-run equilibrium in a purely competitive market. In that case, it means that every single firm is making a loss. To minimize losses, the firm should exit the industry so that the economic profit earned equals zero.
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