Explaining
The goal of a firm is to maximize profits or minimize losses. The firm can achieve this goal by following two rules. First, the firm should operate where MR = MC. Second, the firm should shutdown rather than operate if it can reduce losses by doing so.
Read more about this topic: Shutdown (economics)
Famous quotes containing the word explaining:
“We’ll build a democracy here, even if it’s with Nazi bricks.”
—Samuel Fuller, U.S. screenwriter. Samuel Fuller. Captain Harvey, Verboten! American Military Government officer explaining the practicalities of de-Nazification (1959)
“Behold, Esau my brother is a hairy man, and I am a smooth man.”
—Bible: Hebrew Jacob, in Genesis, 27:11.
To his mother Rebekah, explaining how the blind Isaac might discover the ploy of his pretending to be Esau. “Esau was a cunning hunter, a man of the field; and Jacob was a plain man, dwelling in tents.” (25:27)
“As I write, there is a craze for what is called psychoanalysis, or the cure of diseases by explaining to the patient what is the matter with him: an excellent plan if you happen to know what is the matter with him, especially when the explanation is that there is nothing the matter with him.”
—George Bernard Shaw (1856–1950)