Use the Figure Below to Answer the Following Questions

question 131

Multiple Choice

Use the figure below to answer the following questions. Figure 10.3.2
-Refer to Figure 10.3.2,which illustrates short-run average and marginal cost curves.Which one of the following statements is false?

• A)Average fixed cost decreases with output.
• B)The vertical gap between curves B and C is equal to average variable cost.
• C)Line B comes closer to line C as output increases because of a decrease in average fixed cost.
• D)Curve D is the marginal cost curve.
• E)The vertical gap between curves B and C is equal to average fixed cost.

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Definitions:

Minimum Required Rate

The lowest rate of return or yield that an investor expects or requires from an investment.

Internal Rate of Return

The discount rate at which the net present value of all cash flows (both positive and negative) from a project or investment equals zero.

Rate of Return

A measure of the profitability and efficiency of an investment, expressed as a percentage of the original investment.

Initial Investment

The funds allocated to start a business or a project, representing the beginning financial input.