A Rightward Movement of AD Would Tend To

question 16

Multiple Choice

A rightward movement of AD would tend to:

• A) increase P.
• B) decrease P.
• C) decrease Y.
• D) increase V.
• E) none of the above

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Definitions:

Average Total Cost

The total cost of production divided by the number of units produced, representing the average cost per unit of output.

Average Variable Cost

The total variable costs (costs that change with production volume) divided by the quantity of output produced.

Average Total Cost

The sum of all production costs divided by the quantity of output produced, representing the per-unit cost.

Marginal Cost

Marginal cost refers to the increase or decrease in the total cost when the quantity produced is incremented by one unit.