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:
“Religion. A daughter of Hope and Fear, explaining to Ignorance the nature of the Unknowable.”
—Ambrose Bierce (1842–1914)
“Ezra Pound still lives in a village and his world is a kind of village and people keep explaining things when they live in a village.... I have come not to mind if certain people live in villages and some of my friends still appear to live in villages and a village can be cozy as well as intuitive but must one really keep perpetually explaining and elucidating?”
—Gertrude Stein (1874–1946)
“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)