Will a profit maximising firm in a competitive market produce a positive level of output in the short run if market price is less than the minimum of AVC ? Give an explanation.

Will a profit maximising firm in a competitive market produce a positi

1.	Will a profit maximising firm in a competitive market produce a positive level of output in the short run if market price is less than the minimum of AVC ? Give an explanation.
Answer» SOLUTION :No, a firm will not operate if market price is LESS than the MINIMUM of AVC. It is because if market price = AVC, it is the SHUT down POINT.