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Tags
#cfa #cfa-level-1 #economics #reading-15-demand-and-supply-analysis-the-firm #section-3-analysis-of-revenue-costs-and-profit
Question

When total revenue is enough to cover total [...] but not all of total [...] the firm can survive in the short run but will be unable to maintain financial solvency in the long run.

Answer
variable cost

fixed cost,

Tags
#cfa #cfa-level-1 #economics #reading-15-demand-and-supply-analysis-the-firm #section-3-analysis-of-revenue-costs-and-profit
Question

When total revenue is enough to cover total [...] but not all of total [...] the firm can survive in the short run but will be unable to maintain financial solvency in the long run.

Answer
?

Tags
#cfa #cfa-level-1 #economics #reading-15-demand-and-supply-analysis-the-firm #section-3-analysis-of-revenue-costs-and-profit
Question

When total revenue is enough to cover total [...] but not all of total [...] the firm can survive in the short run but will be unable to maintain financial solvency in the long run.

Answer
variable cost

fixed cost,
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ssociated with fixed cost at zero production. By terminating business operations through market exit, investors escape the erosion in their equity capital from economic losses. When total revenue is enough to cover total <span>variable cost but not all of total fixed cost, the firm can survive in the short run but will be unable to maintain financial solvency in the long run. Exhibit 21 Revenu

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