Suppose a price-taker firm produces baseball bats that sell at a price of $100 each. This firm’s average total cost at the current level of production is $150 per bat, and the average fixed cost is $40 per bat. Which of the following statements is TRUE regarding this firm They should:（）
A. shut down in the short run because their average total cost is greater than their price.
B. continue producing baseball bats because they are covering their fixed costs.
C. shut down in the short run because their average variable cost is greater than their price.
参考答案：C
解析：
Variable costs = $150 (ATC) - $ 40 (AFC) = $110 (AVC). At a selling price of $100 the firm is not covering its variable costs and will have losses greater than its fixed costs if it stays in business.