Al's Donuts Produces About 600 Dozen Doughnuts Daily

question 179

Multiple Choice

Al's Donuts produces about 600 dozen doughnuts daily. If flour prices increase 20 percent

• A) only marginal cost will shift up.
• B) only marginal cost and average total cost will shift up.
• C) marginal cost, average variable cost, and average total cost will shift up.
• D) marginal cost, average total cost, and average fixed cost will shift up.

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Definitions:

Fixed Amount

A specified sum of money that does not change or vary.

Payable

Refers to an amount of money that is owed and should be paid, often within a specified period.

Instrument

A formal document that serves as a legal evidence of a fact or agreement, such as a contract, deed, will, or promissory note.

Promissory Notes

Written promises to pay a specified sum of money to a certain person or entity under agreed terms.