The Graph Shows the Extraction Costs for TX Oil Company

question 280

Multiple Choice

The graph shows the extraction costs for TX Oil Company in the first year in a situation where it will extract oil from a reserve over two years. If user costs increase, then the total cost line will

• A)stay the same and the extraction cost line will shift upward.
• B)shift upward and the extraction cost line will shift downward.
• C)shift upward and the extraction cost line will shift upward.
• D)shift upward and the extraction cost line will stay the same.

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