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:
“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)
“If you’re lucky, you have money. That’s why it’s better to be born lucky than rich. If you’re rich, you can always lose your money, but if you’re lucky, you’ll always get more money.”
—Anthony Pélissier. Explaining her philosophy of life to her son (1949)
“... does it seem to you that it is possible to speak of Art? It would be the same as explaining love!”
—Eleonora Duse (1859–1924)