At 20 Units of Output, a Firm Finds That Its

question 116

Multiple Choice

At 20 units of output, a firm finds that its average variable cost is $5 per unit and its average total cost is $8 per unit.Therefore, its:

• A) marginal cost is less than $3 per unit.
• B) marginal cost is $3 per unit.
• C) average fixed cost is $3 per unit.
• D) marginal cost is equal to its average fixed cost.

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