A competitive firm should shut down if price is below ATC. If the firm has sunk costs that it amortizes(分期清偿，摊提) and treats as fixed,it may produce in the short run if price is greater than average variable cost. Shut-Down Rule:The firm should shut down if the price of the products is less than the average economic cost of production at the profit-maximizing output.A competitive firm should shut down if price is below ATC. If the firm has sunk costs that it amortizes (分期清偿, 摊提) and treats as fixed, it may produce in the short run if price is greater than average variable cost. Shut-Down Rule: The firm should shut down if the price of the products is less than the average economic cost of production at the profit-maximizing output