Arrange the following steps in the correct order to determine whether a business should continue operating or shut down based on fixed costs and revenues: A) Calculate total fixed costs. B) Compare total revenue with total costs. C) Analyze the potential for covering variable costs if operations continue. D) Make a decision based on whether losses can be minimized or profits maximized.

To determine whether a business should continue operating or shut down, the first step is to calculate total fixed costs, which are the expenses that do not change regardless of how much the business produces. Next, you compare the total revenue generated from sales with the total costs, including both fixed and variable costs. After that, it’s important to analyze whether continuing operations can help cover variable costs, which are costs that change with production levels. Finally, based on this analysis, you make a decision on whether the business can minimize losses or maximize profits. For example, if a café has high fixed costs but low revenue, it might decide to shut down if it cannot cover its variable costs from sales.