Foundations of Economics (8th Edition)
8th Edition
ISBN: 9780134486819
Author: Robin Bade, Michael Parkin
Publisher: PEARSON
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Question
Chapter 14, Problem 4MCQ
To determine
Choose the correct answer from the following options:
- Marginal cost equals average variable cost
Average total cost is at a minimum- Marginal cost exceeds average fixed cost
- Average total cost exceeds average variable cost
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Check out a sample textbook solutionStudents have asked these similar questions
This refers to the ratio of a small increment of cost and a small increment of output.
a. Increment cost
b. Marginal cost
c. Differential cost
d. All of these
Which of the following is true of the relationship between Average Cost and Marginal Cost
Select one:
a. None of the answers given
b. Average increases when marginal cost decreases
c. Average costs decreases when marginal cost increases
d. Average costs increases when marginal cost increases
Average total cost, average variable cost marginal cost and marginal product
b. The relationship between marginal product and marginal cost is reciprocal or
opposite. Why is it so? Explain.
Chapter 14 Solutions
Foundations of Economics (8th Edition)
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Similar questions
- a. Calculate marginal cost using the formula given in the chapter: ATotal cost/AQuantity. Quantity Variable cost ($) Total cost ($) Marginal cost ($) 0 0 100 1 60 160 2 110 210 100 3 180 280 100 4 270 370 100 5 400 500 100 b. Calculate AVariable cost/AQuantity. Quantity Variable cost ($) AVariable cost Total cost ($) ($)/ AQuantity 0 0 100 1 60 160 100 2 110 210 100 3 180 280 100 4 270 370 100 5 400 500 100arrow_forwardMarginal cost, average total cost and average variable cost Marginal cost and average total cost are always equal. Do you agree? Explain. If you disagree then write under what situation they are equal. b. Marginal cost and average variable cost are always equal. Do you agree? Explain. If you disagree then write under what situation they are equal.arrow_forwardwhat is meant by the term Cost of production? Distinguish between fixed and variable cost. Why short run average cost and marginal cost curve generally U-Shaped?arrow_forward
- find 10 problems related to variable cost, total cost, and marginal cost and Solve problemsarrow_forwardAs long as marginal cost is below average variable cost or average total cost , then average variable cost and average total cost ____ when output is increased. a. rises b. intersects c. falls d. are constantarrow_forwardIf the marginal cost is above the average cost at a certain level of production and the firmdecides to increase output, then:a. The average cost will increase but the marginal cost will decrease.b. Both the average and the marginal cost will increase.c. The average cost will increase but the average cost will decrease.d. Both the average and the marginal cost will decrease.arrow_forward
- The average total cost (ATC) curve will be downward sloping so long as the a. marginal cost is greater than average total cost. b. marginal cost is less than average total cost. c. average variable cost is less than average total cost. d. average fixed cost is less than average total costarrow_forwardMboth the marginal cost and the average variable cost curves are U-shaped, at the minimum point of the average variable cost curve, the marginal cost curve must be greater than average total cost. less than average total cost. equal to averagn total cost. at its minimum.arrow_forwardThe difference between variable cost and fixed cost is that Select one: a. fixed cost is paid even when there is no output b. fixed cost is always falling as output increases c variable cost only increases for a while and then it decreases d. fixed cost is always less than variable cost e. fixed cost is not paid once production beginsarrow_forward
- Which of the following cost curves is never U-shaped? a. the average fixed cost curve b. the average total cost curve c. the marginal cost curve d. the average variable cost curvearrow_forwardAsap Total cost can be divided into two types. What are those two types? Select one: a. fixed costs and average costs b. fixed costs and variable costs c. average costs and marginal costs d. fixed costs and marginal costsarrow_forward1. Economies and Diseconomies of scale 2. Graph of marginal cost, average cost and average total cost. Take an example 3. Marginal cost, average variable cost, and average total cost. Take an examplearrow_forward
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