why-is-the-average-total-cost-curve-significant-in-long-run-market-entry-and-exi

Question

Why is the average total cost curve significant in long run market entry and exit decisions?

Accepted Answer

It determines whether a firm can cover all its costs in the long run.

Answer

It only affects variable costs.

Answer

It is irrelevant to both entry and exit decisions.

Answer

It only affects short run production decisions.