Question

If price is less than the average variable cost of a representative firm in a competitive industry in short-run:_________

A. there will be exit from the industry immediately.
B. the firms in the industry should shut down and produce no output
C. the firms in the industry are just earning a normal rate of return.
D. the firms should produce a level of output in which marginal cost is equal to price.
E. the industry is in long-run equilibrium.

Answer 1

I think the answer is "D"

Step-by-step explanation:

hope it helps :)