the quantity of supply does not matter....
do u understand wt is AVC... and wt does P=AVC means?
AVC, the average variable cost
if the P is below the AVC, the firm would lost less to shut down... as the P cannot even cover up the variable cost.... e.g. wages for labour
if the P is above the AVC, although the firm is losing out... (i assume), the firm's revenue is enough for the variable cost, and some of the fixed cost... therefore the firm would stay... coz there might also be cost for shutting down or leaving the market...