The average fixed cost (AFC) curve
A. Declines as long as output increases.
B. Intersects the marginal cost curve at its minimum point.
C. Is intersected at its minimum point by marginal cost.
D. Is U-shaped as a result of diminishing returns.
Answer: A
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Investments made "today" in machines, equipment and buildings do not have an immediate effect on total capital stock
Indicate whether the statement is true or false
Assume the following: M = $500; V = 10; and Q = 500. From the equation of exchange, the value of P is
a. $20. b. $10. c. $15. d. $5.
Measured in 2014 dollars, real GDP per person in the United States in 2014 was about
a. $37,000. b. $56,000. c. $57,000. d. $67,000.
A “liberal” would most likely argue in favor of
A. tax increases when fiscal stimulus is necessary, and spending cuts when fiscal restraint is necessary. B. tax cuts when fiscal restraint is necessary, and spending cuts when fiscal stimulus is necessary. C. tax cuts when fiscal stimulus is necessary, and spending cuts when fiscal restraint is necessary. D. spending increases when fiscal expansion is necessary, and tax increases when fiscal restraint is necessary.