What Is the Minimum Point on the Average Variable Cost

question 139

Multiple Choice

What is the minimum point on the average variable cost curve called?

• A)The shutdown point.
• B)The break-even point.
• C)The loss minimising point.
• D)The point of diminishing returns.

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Definitions:

Marginal Revenue Product

Marginal Revenue Product is the additional revenue gained from employing one more unit of a resource, crucial for determining how much of a resource to employ.

Wage Rate

The amount of compensation paid to an employee by an employer in exchange for performing specific tasks within a given period.

Perfectly Competitive Firm

A company operating in a market where there are many sellers and buyers, the product is identical across suppliers, and there are no barriers to entering the market, leading to no control over prices.

Marginal Revenue Product

The additional revenue gained by employing one more unit of a factor of production.