In the Short Run, ________ Costs Exceed ________ Costs

question 27

Multiple Choice

In the short run, ________ costs exceed ________ costs.

• A) total fixed; total
• B) average variable; average total
• C) total variable; total
• D) average total; average variable

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Definitions:

Total Variable Costs

Total Variable Costs are the cumulative expenses that change in proportion to the level of goods or services produced, including costs such as raw materials and labor.

Total Cost

The sum of all expenses incurred in the production of goods or delivery of services, including fixed and variable costs.

Marginal Cost Curve

The graphical representation that shows how the cost of producing one additional unit changes as production volume increases.

Average Variable Cost Curve

A graphical representation that shows the change in variable cost per unit of output as the level of production is altered.