When a Firm Increases the Amount of Capital It Uses

question 17

Multiple Choice

When a firm increases the amount of capital it uses, the

• A)average total cost curve shifts down.
• B)average total cost curve shifts up.
• C)average total cost curve twists, increasing ATC at low output levels and decreasing ATC at high output levels.
• D)average variable cost curve shifts up.
• E)average fixed cost decreases.

---

Definitions:

Simple Interest Rate

A method of calculating interest where the rate is applied only to the principal amount, without compounding.

Invested

Assets or capital put into an endeavor or investment with the expectation of generating a profit.

Days

Units of time measuring 24 hours, constituting the most basic building block of calendars.

Missing Value

Data that is absent from a dataset, which can occur for various reasons and potentially impact analyses.