Asked by
Colin Phillips
on Oct 08, 2024
Verified
(Consider This) An unprofitable motel will stay open in the short run if:
A) price (average nightly room rate) exceeds average variable cost.
B) marginal revenue exceeds marginal cost.
C) price (average nightly room rate) exceeds average fixed cost.
D) marginal revenue exceeds price.
Average Variable Cost
entails the calculation of the unit cost for variable expenses associated with production, adjusted for changes in output levels, providing insight into economies of scale.
Marginal Revenue
The increased earnings obtained by selling an additional unit of a good or service.
- Learn about the operational strategies of firms over short and extended periods, focusing on decisions to shut down or exit the business domain.
Verified Answer
ER
Learning Objectives
- Learn about the operational strategies of firms over short and extended periods, focusing on decisions to shut down or exit the business domain.