Question

b. At its best possible output level, a firm has total revenue of $6,000 per day and total cost of $10,000 per day. What should this firm do in the short run if it has total fixed costs of $3,000 per day

Answer 1

Follows are the solution to this question:

Step-by-step explanation:

Given value:

`\to TR = \$ \ 6,000 \\\\\\to TC = \$ \ 10,000 \\\\\ \to TFC = \$ \ 3,000 \ \ \ and \ \ \ TVC = \$ \ 7,000`

It is provided that the Finn could not offset its variable advertising expenditures, shortly it wants to shut down.