Examlex

Solved

What Is the Typical Shape of the AFC Curve? Explain

question 145

Essay

What is the typical shape of the AFC curve? Explain why it is shaped this way.


Definitions:

Long-Run Average Cost

The average cost per unit of output when all inputs, including physical capital, are variable in the long term.

Upward-Sloping

A graph line that increases in height as it moves from left to right, characteristic of certain supply curves.

Economies of Scale

Cost advantages achieved by increasing production levels, resulting in lower per-unit costs due to spreading fixed costs over more units.

Long-Run Average Total Cost

A concept in economics that represents the per-unit cost of production in the long term, where all inputs are considered variable.

Related Questions