The Average Variable Cost of Producing 250 Sundaes Is $5

question 290

Multiple Choice

The average variable cost of producing 250 sundaes is $5. At this level of output, average variable cost is minimized. Which of the following statements is true?

• A) Marginal cost of the 251st sundae is $1,250.
• B) Average total cost is minimized at an output greater than 250 sundaes.
• C) Average fixed cost is minimized at an output less than 250 sundaes.
• D) Total cost of producing 250 sundaes is $1,250.

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Definitions:

Opponent Processing

A theory describing how the human visual system interprets color by processing signals from cones and rods in an antagonistic manner.

Accommodation

In cognitive psychology, the process by which individuals adjust their schemas (mental models) to incorporate new information.

Feature Detectors

Feature detectors are specialized brain cells that identify specific elements in the visual field, like shapes, angles, or movements.

Fovea

A small depression in the retina of the eye where visual acuity is highest due to a high concentration of cones.