Refer to Figure 8.6, which shows just three of a firm's various possible short-run average cost curves. Suppose the firm is currently producing 160 units at anaverage cost of $90 per unit. Which of the following statements is true?$/unit2001751509080R5050OACIAC2X160130AC3OutputFigure 8.6The firm could reduce its short-run average cost by producing less output.The firm is producing the level of output that minimizes short-run average cost.The firm is producing its output at the lowest possible long-run average cost.The firm could reduce its short-run average cost by producing more output.

Industrial economics is the study and appraisal of business financial issues utilizing abstract…

Refer to Figure 8.6, which shows just three of a firm's various possible short-run average cost curves. Suppose the firm is currently producing 160 units at an average cost of $90 per unit. Which of the following statements is true? $/unit 200 175 1.50 90 80 R 50 50 ACI 160 AC2 AC3 Output 130 Figure 8.6 The firm could reduce its short-run average cost by producing less output. The firm is producing the level of output that minimizes short-run average cost. The firm is producing its output at the lowest possible long-run average cost. The firm could reduce its short-run average cost by producing more output.