Final answer:
The question explores the decision of whether a business should continue or shut down based on revenues, costs, and fixed costs. Without information about the fixed costs, a definitive decision cannot be made. However, if the fixed costs are less than the difference between revenues and variable costs, it is advisable to continue the business.
Step-by-step explanation:
The question is about the decision to continue or shut down a business based on revenues and costs. In this case, the center earns $20,000 in revenues and incurs $15,000 in variable costs. To determine whether the center should continue in business or shut down, we need to consider the fixed costs as well.
If the fixed costs are less than the difference between revenues and variable costs, it is economically viable to continue the business. If the fixed costs are higher than the difference, it would be more profitable to shut down the business.
In this scenario, no information about fixed costs is provided, so we cannot make a definitive decision. However, if we know that the fixed costs are less than $5,000 ($20,000 - $15,000), it would be advisable to continue the business. If the fixed costs exceed $5,000, it would be more profitable to shut down the business and avoid incurring losses.