Final answer:
To no longer operate at a loss, the store must sell t-shirts in a quantity where the price per unit is equal to or greater than the average total cost, reaching the break-even point and thus avoiding losses.
Step-by-step explanation:
The question of how many t-shirts need to be sold by the store to no longer operate at a loss can be addressed by understanding the principles of break-even analysis in business. Based on the provided information, for the store to stop incurring losses, it must sell enough t-shirts to cover at least its production costs. According to the data, when producing five units, the store experiences losses because the total costs exceed total revenues and the price per unit is less than both average and marginal costs. To achieve a state where the store is no longer operating at a loss, the price must at least equal the average cost, meaning that the break-even point is when the price is equal to the average cost.
From the provided business scenario, the store needs to sell t-shirts at a quantity where the price per unit exceeds the average variable cost and reaches a point where it is equal to the average total cost. This is the break-even point that must be achieved to ensure no losses are incurred in the store's operations. This indicates that the correct answer to the question is (b) Equal to the production cost.