Suppose That Each Firm in an Industry Has a Total

question 140

Multiple Choice

Suppose that each firm in an industry has a total cost curve given by TC = 7,000 + 50Q. The lowest average total cost of producing 1,000 units of output occurs when:

• A) two firms each produce 500 units of output.
• B) one firm produces all 1,000 units of output.
• C) four firms each produce 250 units of output.
• D) 10 firms each produce 100 units of output.

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Definitions:

Total Income

The sum of all wages, salaries, profits, interest payments, rents, and other forms of earnings received by an individual or business in a given period.

Compensation of Employees

Refers to the total remuneration, in cash or in kind, payable by an employer to an employee in return for work done.

Total Income

Represents the aggregate revenue or earnings received by an individual, group, or entity from all sources before any deductions or taxes.

Human Capital

The skills, knowledge, and experience possessed by an individual or population, viewed in terms of their value or cost to an organization or country.