Which of the following statements is correct?
a. When price p is above a price taking firm’s SAC, the price taking firm profits may be negative but it will choose to continue producing as long as variable cost are covered.
b. When price p is above a price taking firm’s SAVC, but below its SAC, the price taking firm profits may be positive - in this case, it will choose to continue producing because variable cost are covered.
c. When price p is above a price taking firm’s SAVC, but below its SAC, the price taking firm profits will be negative - in this case, it will choose to continue producing because variable cost are covered.
d. All of the above.