4.Which of the following most accurately describes the shape of the average fixed cost (AFC) curve? The AFC curve: A:A:is always below the average variable cost curve.B:B:becomes flatter as output increasesC:C:becomes flatter as output increases 正确答案:B 分享到: 答案解析: 暂无解析 ...
Explain the equimarginal principle. The short run average total cost curve (ATC) is U-shaped because of the conflicting effects of (a) ... and (b) ... How do indivisible inputs affect producti Define and explain how to calculate average fixed costs (AFC). Define explicit...
Average Cost (AC) is equal to the sum of Average Variable Cost (AVC) and Average Fixed Cost (AFC). i.e., AC = AVC + AFC i.e., AC - AVC = AFC (AC is greater than AVC by the amount of AFC.) The vertical distance between AC and AVC curves continues to fall wi...
EconomicEfficiency:productionofagivenamountofoutputatthelowestpossiblecost.Shortrunandlongrun –Twotypesofinputs •Fixedinput•Variableinput –Afixedinput:thelevelofusagecannotreadilybechanged.However,noinputiseverabsolutelyfixed–justinpracticalsense–Avariableinput:thelevelofusagemaybechangedquitereadily...
Thisresultsinasupplycurvethatslopesupward.TheFirm’sObjective Theeconomicgoalofthefirmistomaximizeprofits.AFirm’sTotalRevenueandTotalCost TotalRevenue Theamountthatthefirmreceivesforthesaleofitsoutput.TotalCost Theamountthatthefirmpaystobuyinputs.AFirm’sProfit Profitisthefirm’stotalrevenueminusitstotalcost.P...
Lecture_3_-_Theory_of_the_Firm THEORYOFTHEFIRM HowFirmsBehave:Costs,Revenues&ProfitMaximisation ASSUMPTIONS Assumption 1:MAXIMISEPROFITS Thereforeproduceatanoutputwhereprofitismaximised Assumption 2:MINIMISECOSTS Butcostsdifferbetweentheshortrunandthelongrun 2 INPUTS/OUTPUTS For...
The average-total-cost curve is U-shaped. The marginal-cost curve crosses the average-total-cost curve at the minimum of average total cost. Costs in the Long Run For many firms, the division of total costs between fixed and variable costs depends on the time horizon being considered. In ...
Cost Curves: A graphical representation of various costs facing a firm, which are: average total cost, average variable cost, average fixed cost, and marginal cost. Profit Maximizing Quantity: The amount of a good or service a firm will produce where its marginal costs equal its marginal reve...
Explain the reasoning behind the U-shaped, long-run, average cost curve. Define and explain how to calculate average variable costs (AVC). Define and explain how to calculate average fixed costs (AFC). Explain the effect on the amount of utility experienced with an increase in amount of budg...
Answer to: The sum of fixed cost and variable cost at any rate of output is equal to: a. Average total cost. b. Total profit. c. Total cost. d...