Other Things Equal, If the Fixed Costs of a Firm

question 99

Multiple Choice

Other things equal, if the fixed costs of a firm were to increase by $100,000 per year, which of the following would happen?

• A)Marginal costs and average variable costs would both rise.
• B)Average fixed costs and average variable costs would rise.
• C)Average fixed costs and average total costs would rise.
• D)Average fixed costs would rise, but marginal costs would fall.

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Definitions:

Ester Hydrolysis

A chemical reaction in which an ester is converted into its constituent alcohol and acid by the action of water or a hydroxide ion.

Major Product

The main product formed in a chemical reaction, which is generated in greater amounts compared to any other product.

Major Product

The chemical species that is formed in the largest amount from a chemical reaction, indicating the most favorable pathway under the given reaction conditions.

Major Organic Product

The primary chemical product formed in the highest yield during a chemical reaction, especially in organic synthesis reactions.