If the Fixed Cost of Producing a Good Is Very

question 42

Multiple Choice

If the fixed cost of producing a good is very high,but the marginal cost is low and constant,then the average total cost will

• A) increase as more units are produced.
• B) decrease as more units are produced.
• C) first decrease and then increase as more units are produced.
• D) not change as more units are produced.

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Definitions:

Control Group

In experimental research, the group of subjects that does not receive the treatment being tested, serving as a benchmark for measuring the effect of that treatment.

Experimental

Pertaining to or based on experiments, which are structured and controlled tests or investigations to establish or test a hypothesis.

Placebo

An inert or non-effective substance or treatment given to a participant in a study, used to contrast with an active substance to test its efficacy.

Test

An assessment or examination intended to measure a test-taker's knowledge, skill, aptitude, physical fitness, or classification in many other topics.