Use the concepts of economies and diseconomies of scale to explain the shape of a firm's long-run ATC curve. Economists usually graph "U-shaped" cost curves, but sometimes a flat, constant ATC = MC curve is drawn. According to Dr. Raymond, this is because ___. If the ATC curve is ...
Q TC TFC TVC ATC AFC AVC MC 0 40 x x x x 1 52 2 20 3 21.33 4 4 5 40 6 15.67 7 10 8 96 9 15 10 45 b. Graph the average total cost curve, the average fixed cost curve, and the average variable cost cur...
The total cost continues to accelerate as output expands, as the risks attributable to increased scale offset the rapidly diminishing returns. Average Total Cost Curve – Illustrative Graph The spreading effect and the law of diminishing utility are the two factors that cause the U-shape curve to ...
Q TFC TVC TC MC AFC AVC ATC 0 0 10 400 20 2700 100 30 3300 40 1500 Given the following data provided in the table below, what will the fixed costs equal for production at the quantity (Q) level 4? |Q|P|TC...
Graph AVC, ATC, and MC curves. Why are they U-Shaped? Explain why the Marginal Cost curves tend to have a U-shape, assuming there is a fixed wage rate in the short-run. Why does the MC curve cut the ATC curve at ...
Use the graph above to fill out the following table. ||Price||Quantity||Produce or Shutdown||Profit or Loss |15| | | |20| | | |25| | | |55| | | |70| | | Find TC, MC, AFC, AVC, and ATC from the following table. Instructions: Round your answers to...
Indicate whether the following statement is true, false, or uncertain; explain your answer and include a graph if necessary: The ATC curve intersects the MC curve at the MC?s minimum. The short-run MC curve intersects the short-run AVC curve from below at the AVC ...
Answer to: If MC is less than ATC, we know that: Select one: a. AVC must be falling. b. ATC must be rising. c. ATC must be falling. d. ATC could be...
Allow ATC = Average Total Cost, AVC = Average Variable Cost, MC = Marginal Cost, MR = Marginal Revenue, and P = Price. Which of the following statements best describes a profit-maximizing/loss-minimiz If there is a decrease in output then...
Explain the relationship and significance of ATC, AVC, AFC, and MC. Explain and graph an event which leads to lower prices and lower quantity produced of a certain good. Explain the typical shapes of the AFC, AVC, and ATC curves in short-run production. Explain and graph an ev...