The Diagram Shows the Average Total Cost Curve for a Purely

question 241

Multiple Choice

The diagram shows the average total cost curve for a purely competitive firm. At the long-run equilibrium level of output, this firm's total cost

• A)is $10.
• B)is $40.
• C)is $400.
• D)cannot be determined from the information provided.

---

Definitions:

Opportunity Cost

The amount of other products that must be forgone or sacrificed to produce a unit of a product.

Tax Return

A form filed with a government body to report income, expenses, and other relevant financial information, used to assess tax liability.

Diminishing Marginal Returns

A principle in economics where each additional unit of input results in a smaller increase in output after a certain point, common in production processes.