AJAX is a competitive firm operating under the following conditions: Price of output is $5, the profit maximizing level of output is 20.

AJAX is a competitive firm operating under the following conditions: Price of output is $5, the profit maximizinglevel of output is 20.000 unit of output, and the total cost (full economic cost) of producing 20.000 units is $120.000. The firm’s only fixed factor of production is a $300.000 stock of capital (a building). If the interest rateavailable on comparable risks is 10%, should this firm shut down immediately in the short run? Explain your answer.