Which of the Following Is True

question 129

Multiple Choice

Which of the following is true?

• A) At some high level of output, AFC is zero.
• B) If the law of diminishing marginal returns did not exist, then the marginal cost curve would not have an upward-sloping portion.
• C) The marginal cost curve cuts the average variable cost curve at its midpoint.
• D) There are no fixed costs in the short run.
• E) none of the above

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Definitions:

Cartel

A cartel refers to an association of independent businesses or countries that collaborate to manipulate prices and limit competition for certain goods or services.

Cartel

An agreement between competing firms to control prices or exclude entry of a new competitor in a market, usually to increase market power and profits.

Formal Agreement

refers to a legally binding contract between parties that outlines specific obligations and rights.

Covert Collusion

A secret agreement between firms to fix prices, limit production, or engage in other practices to restrict competition illegally.