-In the Above Figure, Which of the Following Statements Is

question 357

Multiple Choice

-In the above figure, which of the following statements is FALSE?

• A) Average fixed cost decreases as output decreases.
• B) The vertical gap between curves B and C equals marginal fixed cost.
• C) The vertical gap between curves B and C gets smaller as AFC decreases.
• D) Curve A is the marginal cost curve.

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Definitions:

Maintenance

The routine care and servicing by personnel for the purpose of maintaining equipment or facilities in satisfactory operating condition.

Operating Lease

A lease agreement that allows for the use of an asset but does not convey rights of ownership of the asset.

Financial Lease

A long-term lease agreement that allows the lessee to use an asset while essentially assuming both the risks and benefits of ownership.