Exhibit 10

Multiple Choice

Exhibit 10.2 shows a firm that charges price P* for output q*.In order to minimize loss in the short run,the firm should _____

A) shut down, because price is greater than average variable cost.
B) shut down, because price is greater than marginal cost.
C) shut down, because price is less than marginal revenue.
D) continue to produce, because price is greater than average variable cost.
E) continue to produce, because price is greater than marginal cost.