If the price is greater than the average variable cost and less than the average total cost at the profit-maximizing quantity of output in the short run,a perfectly competitive firm will:

A) produce at an economic loss.
B) produce at an economic profit.
C) shut down production.
D) produce more than the profit-maximizing quantity.

Average Variable Cost

The cost of labor and materials divided by the quantity of output produced, reflecting costs that change with the level of output.

Average Total Cost

The total cost of production divided by the quantity of output produced; it includes both fixed and variable costs.

Economic Loss

This occurs when total costs exceed total revenue, leading to a negative profit situation.