Sonam posted an Question
June 18, 2021 • 18:13 pm 30 points
  • UGC NET
  • Commerce

Price < avc is shut down point or price = avc is shut down point

Price < AVC is shut down point or Price = AVC is shut down point

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  • Ankita

    So long the firm cover its avc + part of annual fixed cost it is available to the firm to continue production. whereas, it only cover up variable cost and nothing for its fixed cost that is shut down point.

  • Archana sharma best-answer

    In short run under perfect competition, Fixed cost have already been incurred. Hence, a firm will operate in the market even if it is incurring losses but is atleast able to cover variable costs. This is known as Shut down point:where, AR=AVC Or TR=TVC Or P=AVC.

    eduncle-logo-app

    but mene ye bhi pdha tha . atleast avc cover hona chahiye price but when p< avc then it is shut down point

    eduncle-logo-app

    see this..

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