Which of the Following Statements Concerning Long- Run and Short-

question 50

Multiple Choice

Which of the following statements concerning long- run and short- run cost curves is correct?

• A) A short- run average cost curve can fall below the long- run average cost curve.
• B) The short- run average cost curve is tangent to the long- run average cost curve for all levels of output of the fixed factor.
• C) Both the long- run and short- run average cost curves show the lowest cost of producing any output when all factors are variable.
• D) The long- run average cost curve envelops a whole family of short- run marginal cost curves.
• E) The minimum point of the long- run average cost curve will correspond to the minimum point on a single short- run average cost curve.

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Definitions:

Drag

A force acting opposite to the relative motion of any object moving with respect to a surrounding fluid; it also describes the resistance an object encounters while moving through a fluid (like air or water).

Cope

In construction and metalworking, to shape the end of a beam or metal profile so that it fits the contours of another for a joining process.

Cheeks

Parts of an object or tool flanking other components, typically used in the context of machinery or the human face.

Rounded Corners

Corners that are shaped into a smooth, rounded angle to improve appearance, handling, or safety.