Average Total Cost Is Very High When a Small Amount

question 211

Multiple Choice

Average total cost is very high when a small amount of output is produced because

• A)average variable cost is high.
• B)average fixed cost is high.
• C)marginal cost is high.
• D)marginal product is high.

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Definitions:

Public Goods

Goods that are non-excludable and non-rivalrous, meaning their use by one person does not reduce availability to others.

Consumption Goods

Products and services that are consumed by the ultimate consumer and do not serve as input for the production of other goods or services.

Public Goods

Goods that are available for everyone to consume, regardless of whether they pay for them or not, and whose consumption by one individual does not diminish the quantity available to others.

Private Firms

Businesses that are owned, operated, and managed by private individuals or entities rather than by the government or public.