Monopolist Shutdown Rule
A monopolist should shut down when price is less than average variable cost for every output level. – in other words where the demand curve is entirely below the average variable cost curve. Under these circumstances at the profit maximum level of output (MR = MC) average revenue would be less than average variable costs and the monopolists would be better off shutting down in the short term.
Read more about this topic: Monopoly (economics)
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