Use the graph below to answer the following question: ATC, AVC & MC ($) 20 MC2 MC1 ATC2 ATC1 AVC2 AVC1 Q2 Q1 Quantity of Cars A. List one reason why the curves shown in the graph above would shift from AVC1 to AVC2, ATC1 to ATC 2 and MC1 to MC 2 B. What is the formula for the firm's short run temporary shutdown point? Explain. C. Explain how you would determine the value of Average Fixed cost from the graph,

Exploring Economics
8th Edition
ISBN:9781544336329
Author:Robert L. Sexton
Publisher:Robert L. Sexton
Chapter11: The Firm: Production And Costs
Section: Chapter Questions
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Use the graph below to answer the following question:
ATC, AVC & MC ($)
20
MC2
MC1
ATC2
ATC1
AVC2
AVC1
Q2 Q1
Quantity of Cars
A. List one reason why the curves shown in the graph above would shift from AVC1 to AVC2, ATC1 to ATC 2 and MC1 to MC 2
B. What is the formula for the firm's short run temporary shutdown point? Explain.
C. Explain how you would determine the value of Average Fixed cost from the graph,
Transcribed Image Text:Use the graph below to answer the following question: ATC, AVC & MC ($) 20 MC2 MC1 ATC2 ATC1 AVC2 AVC1 Q2 Q1 Quantity of Cars A. List one reason why the curves shown in the graph above would shift from AVC1 to AVC2, ATC1 to ATC 2 and MC1 to MC 2 B. What is the formula for the firm's short run temporary shutdown point? Explain. C. Explain how you would determine the value of Average Fixed cost from the graph,
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