Maximize the profit at given price P0
Shutdown Condition: In short run, firm will shutdown if TR < VC at maximum profit output, which is q* where MC = MR.
Equilibrium = No tendency for change.
The short-run equilibrium is when the firm will not be motivated to change. That would be when they are maximizing profits, ie: when MC=MR, with the one exception of a shutdown condition (or when AVC > MR). This is even true if they are losing money overall (MR<ATC). Any other condition would not be a short run equilibrium because they would be motivated to get to MC=MR no matter what.