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isabella derteano
on Dec 11, 2024

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The average fixed costs of a firm equal

A) implicit costs divided by output.
B) explicit costs divided by output.
C) total cost minus variable cost.
D) (total cost minus variable cost) divided by output.

Average Fixed Costs

The fixed expenses of a business divided by the number of units produced, demonstrating how those costs dilute with increased production.

Implicit Costs

The opportunity costs of using resources owned by the firm for its own production instead of earning income from these resources elsewhere.

Explicit Costs

Direct, out-of-pocket payments made for operations or production, such as wages, rent, and materials.

  • Contrast fixed, variable, and total costs in the context of manufacturing operations.
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Shaylin BirchfieldDec 14, 2024
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