If the Marginal Cost (MC) Curve Is Rising and Is

question 99

Multiple Choice

If the marginal cost (MC) curve is rising and is above the average fixed cost (AFC) curve, then

• A)the AFC curve is rising.
• B)the AFC curve is declining, although the MC curve has nothing to do with this.
• C)the AFC curve is at its minimum point.
• D)the AFC curve is at its maximum point.
• E)Nothing certain can be said about the AFC curve without additional information.

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Definitions:

Materials Quantity Variance

The difference between the actual quantity of materials used in production and the standard amount expected to be used, multiplied by the standard cost per unit.

Standard Cost Variances

The differences between the actual costs incurred and the standard costs set for producing a good or service.

Cost Of Goods Sold

The total cost directly associated with producing goods that have been sold, including materials, labor, and manufacturing overhead.

Materials Price Variance

The difference between the actual cost of materials and the expected (standard) cost, often used to assess purchasing performance.