If price is between avc and atc, the best and most practical thing for a perfectly competitive firm to do is :
continue operating, but plan to go out of business.
shut down immediately, but not liquidate the business.
lower prices to gain revenue from extra volume. raise prices.
shut down immediately and liquidate the business.

Haver company currently produces component rx5 for its sole product. the current cost per unit to manufacture the required 57,000 units of rx5 follows. direct materials $ 5.00 direct labor 9.00 overhead 10.00 total costs per unit $ 24.00 direct materials and direct labor are 100% variable. overhead is 80% fixed. an outside supplier has offered to supply the 57,000 units of rx5 for $20.00 per unit. required: 1. calculate the incremental costs of making and buying component rx5.