The Following Table Shows the Relationship Between Output and Costs

question 20

Multiple Choice

The following table shows the relationship between output and costs for two firms in the short run. Which of the following is correct?

• A)B has lower fixed costs than A.
• B)A has higher per-unit costs than B at an output level of 1.
• C)A has greater marginal costs than B at each level of output.
• D)B starts experiencing diminishing marginal returns with the second unit of output.

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Definitions:

80-Decibel Sound

A sound intensity level; equivalent to the loudness of city traffic or a telephone dial tone.

60-Decibel Sound

A measure of sound intensity, corresponding to moderate levels of noise similar to background music or conversation in a restaurant.

Intense

Characterized by deep or forceful feelings or experiences that are often extreme in nature.

Absolute Threshold

The smallest level of stimulus that can be detected by a sense, such as the lightest touch or faintest sound perceivable.