dollars per unit 1 2 3 4 Output Examine this figure. Which of the following choices correctly identifies the cost curves in the figure? Select one: a. 1: MC. 2: AFC. 3: ATC. 4: AVC. b. 1: ATC. 2: MC. 3: AVC. 4: AFC. c. 1: MC. 2: ATC. 3: AVC. 4: AFC. d. 1: AFC. 2: ATC. 3: MC. 4: AVC.
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In this case, curve 1 intersects curve 2 at its minimum point. Therefore, curve 1 is the MC curve and curve 2 is the ATC curve. Show more…
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A) The following graph shows per unit costs for a firm. Based on this graph answer the following questions. 1. What is ATC when the firm produces 60 units? 2. What is TC when the firm produces 60 units? 3. What is AVC when the firm produces 60 units? 4. What is VC when the firm produces 60 units? 5. What is FC when the firm produces 60 units? 6. What is AFC when the firm produces 60 units? 7. What is MC when the firm produces 60 units? B) Fill in the table below applying the cost equations. Quantity of Output | Fixed costs $ | Variable costs $ | Total cost $ | Average Variable Costs- $ | Average Total costs- $ | Marginal costs- $ 0 | | | 50 | ----- | ----- | ----- 1 | | 15 | | | | 2 | | | | | 37.50 | 3 | | 34 | | | | 9 4 | | | | 10.50 | |
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If a firm wanted to know how much it would save by producing one less unit of output, it would look to:__________. 1. AVC. 2. AFC. 3. MC. 4. ATC.
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This graph depicts average total cost functions for a firm that produces automobiles. Use the graph to answer the following question(s). 1. Refer to Graph. Which of the curves is most likely to characterize the short-run average total cost curve of the biggest factory? a. ATCA b. ATCD c. ATCC d. ATCB 2. Refer to Graph. Which curve represents the long-run average total cost? a. ATCC b. ATCD c. ATCB d. ATCA 3. Refer to Graph. If the firm is currently operating on ATCB, what options does it have if it wants to change its level of automobile production over the next couple of weeks? a. The firm has no options. It cannot change the output level in the short run. b. It can operate at any level of output between points M and N. c. It can operate at any level of output, as long as it stays on ATCD. d. It can operate at any level of output as long as it stays on ATCB. 4. Refer to Graph. This firm experiences constant returns to scale at which output levels? a. All of the above levels if the firm is operating in the long run. b. Output levels above N. c. Output levels between M and N. d. Output levels below M. 5. Refer to Graph. At levels of output below point M, the firm experiences: a. Economic profit. b. Economies of scale. c. Accounting profit. d. Diseconomies of scale.
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