A Short- Run Average Total Cost Curve Will Touch the Long-

question 30

Multiple Choice

A short- run average total cost curve will touch the long- run average cost curve at a level of output only

• A) when the quantity of the fixed factor being employed is at the optimal level for that level of output.
• B) where the short- run cost curve is downward sloping.
• C) by coincidence.
• D) where the short- run cost curve is downward- sloping and the quantity of the fixed factor is optimal.
• E) where the short- run cost curve is upward sloping.

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Definitions:

Risk-Free Return

The guaranteed return on an investment with zero risk of financial loss, typically associated with government bonds.

Standard Deviation

Standard deviation is a statistical measure of the dispersion or variability of a set of data points, commonly used to quantify the risk associated with an investment's return.

Dollar-Weighted Return

is a method for calculating the return on an investment, taking into account the timing of cash flows into and out of the investment, often used to measure the performance of a portfolio.

Dividend

A portion of a company's earnings distributed to shareholders, usually in the form of cash or additional shares.