Refer to the following graph. Which of the following statements is true?
a. The vertical difference between the ATC curve and the AVC curve at any output level equals AFC.
b. Total fixed cost at any output level equals the difference between ATC and AVC.
c. Whenever the MC curve lies below the ATC or AVC curves then ATC and AVC are rising.
d. The AFC curves slopes downward for as long as MC is falling but rises when MC rises.
a. The vertical difference between the ATC curve and the AVC curve at any output level equals AFC.
You might also like to view...
Suppose the government taxes a company that produces plastic water bottles and at the same time consumers become hesitant to use plastic water bottles due to the fear of toxins in the plastic. What would happen in the market to the equilibrium price and quantity of plastic water bottles?
A. Price increases and quantity is indeterminate. B. Quantity decreases and price is indeterminate. C. Quantity increases and price is indeterminate. D. Price decreases and quantity is indeterminate.
The government expenditure multiplier is used to determine the
A) amount aggregate supply is affected by a change in government expenditure. B) amount aggregate demand is affected by a change in government expenditure. C) extra scrutiny government action receives. D) amount private consumption is decreased by government expenditure. E) extent to which automatic stabilizers must be changed in order to avoid recessions.
The city of Ann Arbor Michigan buys a police car manufactured in Germany. In the GDP accounts this transaction is included in
a. in government expenditures and exports.
b. government expenditures and imports.
c. exports, but not government expenditures.
d. imports, but not government expenditures.
In 1933, net private domestic investment was a minus $6.0 billion. This means that:
A. gross private domestic investment exceeded depreciation by $6.0 billion. B. the economy was expanding in that year. C. the production of 1933's GDP used up more capital goods than were produced in that year. D. the economy produced no capital goods at all in 1933.