3. A firm in a perfectly competitive industry finds itself in the
following position: output =1000 units, market price = $3, total
cost = $6,000, fixed cost = $2,000, marginal cost = $3. If the
firm behaves as a profit maximizer, it should:
- reduce output in the short run, but should increase output
in the long run.
- shut down in the long run, but continue producing output
in the short run.
- shut down in the long run, and shut down in the short run.
- increase output in the short run, but reduce output in the long run.
- shut down in the short run, but continue producing output
in the long run.
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