Sproul, Michael (2016): The Shut-down Price, Reconsidered.
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Abstract
The textbook assertion that the shut-down price is at the minimum point of average variable cost AVC is shown to be incorrect. Once we properly distinguish between fixed costs and sunk costs, it becomes clear that the shut-down price is at the minimum point of average cost AC.
| Item Type: | MPRA Paper |
|---|---|
| Original Title: | The Shut-down Price, Reconsidered |
| English Title: | The Shut-down Price, Reconsidered |
| Language: | English |
| Keywords: | shut down price |
| Subjects: | D - Microeconomics > D0 - General D - Microeconomics > D0 - General > D00 - General |
| Item ID: | 74837 |
| Depositing User: | Michael Sproul |
| Date Deposited: | 02 Nov 2016 20:18 |
| Last Modified: | 27 Sep 2019 01:17 |
| References: | Carlton, Dennis W. and Perloff, Jeffrey M., Modern Industrial Organization, Addison Wesley, Reading, Massachusetts, 1999. Jehle, Geoffrey A. and Reny, Philip J., Advanced Microeconomic Theory, Addison Wesley, Reading, Massachusetts, 1998 Mankiw, Gregory N., Principles of Microeconomics, Cengage Learning, Stamford, CT, 2015. |
| URI: | https://mpra.ub.uni-muenchen.de/id/eprint/74837 |
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