The Average Fixed Cost of a Firm Equal

question 147

Multiple Choice

The average fixed cost of a firm equal:

• A) implicit costs divided by output.
• B) explicit costs divided by output.
• C) total cost minus variable cost.
• D) total cost minus total variable cost divided by output.

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Definitions:

Labor Demand Curve

A graphical representation showing the number of workers that businesses are willing and able to hire at different wage rates.

Marginal Expenditure Curve

A graph that shows the additional cost incurred by acquiring one more unit of a good or service.

Monopsony

A market situation in which there is only one buyer for a product or service, giving that buyer substantial power over prices.

Rightward Shift

A movement to the right on a graph, indicating an increase in quantity supplied or demanded at a given price.