Because of the greater flexibility that firms have in the long run, all short-run cost curves lie on or above thelong-run curve.ANS: T DIF: 2 REF: 13-4 NAT: Analytic LOC: Costs of production TOP: Average total cost MSC: Interpretive 相关知识点: 试题来源: 解析 T 长期中企业能调...
Regardless of the economic environment every firm will maximize profits by operating at the minimum point of its average total cost curves. Is this statement true or false? Explain. Firms operating above the minimum efficient scale (MES) ...
Why is the short-run average total cost curve of a firm 'U' shaped? Explain why the long run average total cost curve initially slops downward. Why are both the short-run and the long-run average cost curves u-shaped? Why do short run average cos...
Drawatypicalfirm’s(short-run)marginalcost,averagetotalcost,averagevariablecostandmarginalrevenuecurves.Explainwhythecurveshavetheseshapes.Explainthe..
The average total cost (ATC) curve is the vertical sum of the average fixed cost (AFC) curve and average variable cost (AVC) curve.Long-run Cost CurvesSince all inputs, both labor and capital, are variable in the long-run, the long-run cost structure depends on the firm’s expansion ...
Producers use something called the total cost curve in order to make decisions about their products in the short-run. Explore what total cost and the total cost curve are and how they help producers make decisions in the short-run.
Average cost curves are typically U-shaped, as Figure 7.4 shows. Average total cost starts off relatively high, because at low levels of output total costs are dominated by the fixed cost; mathematically, the denominator is so small that average total cost is large. Average total cost then ...
Revenue, Cost, and Profit 30m The Production Function and Diminishing Returns 12m Marginal Cost 27m The Relationship Between Average Cost and Marginal Cost 23m Graphing Costs 17m Average Total Cost: Short Run and Long Run 19m Isoquant Lines ...
Figures 3a and 3b show the graphs of average and marginal cost respectively. The typical shape of each is a U-shape, with average/marginal cost falling at low levels of output and rising at higher levels of output. Figure 3. Average and Marginal Cost Curves. Figure 3a shows the average ...
EconomicEfficiency:productionofagivenamountofoutputatthelowestpossiblecost.Shortrunandlongrun –Twotypesofinputs •Fixedinput•Variableinput –Afixedinput:thelevelofusagecannotreadilybechanged.However,noinputiseverabsolutelyfixed–justinpracticalsense–Avariableinput:thelevelofusagemaybechangedquitereadily...