Asked by
Hitesh jhanjhari
on Dec 04, 2024
Verified
In the short run, suppose average total cost is a straight line and marginal cost is positive and constant. Then, we know that:
A) marginal cost is less than average total cost.
B) average total cost is positive and constant.
C) average total cost equals marginal cost.
D) A and B are correct.
E) B and C are correct.
Marginal Cost
The price associated with manufacturing one more unit of a product or service.
Average Total Cost
The sum of all production expenses divided by the amount of goods produced.
Fixed Costs
Costs that do not vary with the level of production or services provided.
- Evaluate the association between marginal cost and different average costs (total, variable, fixed) in the study of cost behavior.
- Examine how fixed expenditures influence a company's financial architecture and managerial choices.
Verified Answer
TH
Learning Objectives
- Evaluate the association between marginal cost and different average costs (total, variable, fixed) in the study of cost behavior.
- Examine how fixed expenditures influence a company's financial architecture and managerial choices.