The Yoga Center earns $20,000 in revenue for the month, with $15,000 in variable costs for instructors and $10,000 in fixed rent, for an overall loss of $5,000. According to the source, what should the center do?

1. Revenue of $20,000 comfortably exceeds the $15,000 in variable costs, with $5,000 left over to offset part of the $10,000 fixed rent. 2. Because revenue covers variable costs and contributes toward fixed costs, the loss shrinks to $5,000, smaller than the $10,000 loss from shutting down. 3. The center should continue in business in this scenario. 4. An overall loss does not automatically mean shutdown; the shutdown test looks at variable costs specifically, which this scenario clears. _Source: OpenStax Principles of Microeconomics for AP Courses (CC BY 4.0), Ch 8 "Perfect Competition", section 8.2 | How Perfectly Competitive Firms Make Output Decisions_