Two firms in a local shopping center are losing money. Firm A has high fixed costs and relatively low variable costs. Fi

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answerhappygod
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Two firms in a local shopping center are losing money. Firm A has high fixed costs and relatively low variable costs. Fi

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Two firms in a local shopping center are losing money. Firm Ahas high fixed costs and relatively low variable costs. Firm B haslow fixed costs and relatively high variable costs.
Would you expect firm A to continue operating in the short run,despite losing money? Explain your answer.
Would you expect firm B to continue operating in the short run,despite losing money? Explain your answer.
Would you expect either firm to continue operating in the longrun, despite losing money? Explain why a firm that is losing moneywould exit the market in the long run, despite continuing tooperate in the short run.
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