-Figure 7-7 Shows a Firm's Total Variable Cost for Different

question 125

Multiple Choice

-Figure 7-7 shows a firm's total variable cost for different daily output levels.In addition,the firm has total fixed cost of $50 per day.If output increases from 20 to 30 units,average total cost rises from

• A)$17.50 to $19.17,and marginal cost is $225.00
• B)$400 to $625,and marginal cost is $225.00
• C)$15.00 to $22.50,and marginal cost is $22.50
• D)$20.00 to $20.83,and marginal cost is $22.50
• E)$20.00 to $20.83,and marginal cost is $225.00

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Definitions:

Quantity Purchased

The total amount of goods or services bought by consumers during a specific period.

Deadweight Loss

A decrease in economic efficiency that happens when a good or service does not reach or cannot reach its equilibrium.

Profit Maximizing

The method or approach of aligning production and pricing to maximize profit.

Demand Curve

A graphical representation showing the relationship between the price of a good or service and the quantity demanded by consumers, typically downward sloping.