What Is the Shape of the Average Total Cost Curve

question 116

Multiple Choice

What is the shape of the average total cost curve for a firm in the short run?

• A) U-shaped.
• B) A horizontal line.
• C) A vertical line.
• D) A curve that slopes upward to the right.

---

Definitions:

Collude

When firms work together, often in secret, to fix prices, limit production, or divide markets, in order to increase profits by reducing competition.

Cartel

An alliance of producers who agree to control prices, production, and marketing of their products to maximize collective profits.

Oligopoly Market

A market structure characterized by a small number of firms that dominate the market, often leading to limited competition.

Licensed to Sell

The authorization given to individuals or companies to engage in the selling of certain products or services.