The Market for Sweet Potatoes Consists of 1,000 Identical Firms $S T C = 100 + 100 q + 100 q ^ { 2 }$

question 62

Multiple Choice

The market for sweet potatoes consists of 1,000 identical firms. Each firm has a short-run total cost curve of $S T C = 100 + 100 q + 100 q ^ { 2 }$ , and a short-run marginal cost curve of $S M C = 100 + 200 q$ , where $q$ is output. Suppose that sunk costs are 75 and nonsunk costs are 25 . What is the equation of an individual firm's average nonsunk cost curve?

• A) \(A N S C = 100 + 100 q\)
• B) \(A N S C = 100 + 100 q + 25 / q\)
• C) \(A N S C = 25 / q\)
• D) \(A N S C = 100 + 200 q + 25 / q\)

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Definitions:

Investment

The allocation of resources, usually financial, in expectation of a future return.

IFRS

stands for International Financial Reporting Standards, which are a set of accounting standards developed by the IASB that aim to bring consistency to accounting language, practices, and statements globally.

Consolidated Statement

Financial statements that reflect the combined operations, assets, and liabilities of a parent company and its subsidiaries.

Comprehensive Income

The total change in equity for a reporting period other than transactions from owners.