What is a shutdown point? a) Along the

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Target Exam

CUET

Subject

Economics

Chapter

Micro Economics: Theory of Firms under Perfect Competition

Question:

What is a shutdown point?
a) Along the supply curve as we move down, the last price-output combination at which the firm produces positive output is the point of minimum AVC where the SMC curve cuts the AVC curve.
b) The shut down point is the minimum of LRAC curve.

Options:

Both a and b are true

a is true, b is not

b is true, a is not

Both a and b are false

Correct Answer:

Both a and b are true