Which One of the Following Statements Is False

question 112

Multiple Choice

Which one of the following statements is false?

• A)Average total cost is total cost per unit of output.
• B)Average fixed cost plus average variable cost equals average total cost.
• C)Marginal cost is the increase in total cost resulting from a one-unit increase in output.
• D)Total cost equals fixed cost plus average cost.
• E)Marginal cost depends on the amount of labour hired.

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Definitions:

Per Unit Basis

A method of quantifying costs, revenues, or other financial metrics on the basis of a single unit of production or service.

Activity

A specific task or action that is part of a process or contributes to the completion of a project.

Variable Costs

Expenditures that fluctuate directly in relation to the amount of goods or services produced.

Relevant Range

The relevant range is a level of activity within which assumptions about variable and fixed cost behaviors are valid, used for budgeting and forecasting.