Average Variable Cost Can Be Calculated Using Any of the Formulas

question 85

Multiple Choice

Average variable cost can be calculated using any of the formulas below except

• A)TVC/Q.
• B)(TC - FC)/Q.
• C)Δ(TC - FC)/ΔQ.
• D)(TC/Q)- AFC.

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Definitions:

Dividend Expense

An incorrect term, as dividends are distributions of earnings to shareholders and not an expense. Instead, consider "dividend payment."

Cash Dividends

Payments made out of a corporation's earnings to its shareholders, usually in the form of cash.

Stock Investments

Investments made by purchasing shares of companies in the hope of earning dividends or selling the shares at a higher price.

Insignificant Influence

A situation where an investor does not have the power to participate in the financial and operating policy decisions of another entity.