A Perfectly Competitive Firm Produces 3,000 Units of a Good

Multiple Choice

A perfectly competitive firm produces 3,000 units of a good at a total cost of $36,000.The fixed cost of production is $20,000.The price of each good is $10.Should the firm continue to produce in the short run?

A) No, it should shut down because it is making a loss.
B) Yes, it should continue to produce because its price exceeds its average fixed cost.
C) Yes, it should continue to produce because the firm's revenues cover the total variable cost of $16,000.
D) There is insufficient information to answer the question.