Average Variable Cost (AVC)

question 6

Multiple Choice

Average variable cost (AVC)

• A)always increases with increased output.
• B)always decreases with increased output.
• C)are always flat.
• D)may either increase, decrease, or remain flat with increased output.

---

Definitions:

Cash Account

A ledger account that tracks all cash transactions, including receipts and payments.

Overdrawn Bank Balance

This occurs when withdrawals from a bank account exceed the available balance, resulting in a negative balance.

Journal Entry

A record in the books of accounts that represents a business transaction and its effect on the company's financial position.

Accounts

Financial records of a company's transactions, maintaining detailed information about revenue, expenses, assets, liabilities, and equity.