In the Short Run, the Firm's Average Fixed Costs

question 147

Multiple Choice

In the short run, the firm's average fixed costs

• A) always increase as output increases.
• B) always decline as output increases.
• C) equal zero.
• D) remain constant as output expands.

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Definitions:

Variable Cost

Refers to expenses that vary in proportion to the volume of goods or services produced.

Nonconstant Rate

Refers to a rate or percentage that varies over time or across different situations, not fixed or uniform.

Break-Even Point

The level of production or sales at which total revenues equal total costs, resulting in no net loss or gain.

Graphic Depiction

Refers to the visual representation of data or information, typically using charts, graphs, or maps.