Average Total Cost

question 19

Multiple Choice

Average total cost:

• A) is the sum of average fixed costs and average variable costs.
• B) is total cost divided by total output.
• C) is minimized when it equals marginal cost.
• D) All of these are true.

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Definitions:

Face Value

The nominal or dollar value printed on a security or financial instrument, such as a bond or stock certificate.

Interest Rate

The percentage of a loan that is incurred as interest by the borrower, usually represented as an annual percentage of the outstanding loan amount.

Non-Interest-Bearing

Describes a financial instrument that does not generate interest income for the holder.

Promissory Note

A pecuniary promise recorded in a document, where one side agrees to pay a definite financial sum to the other, available either on demand or on a date in the future that has been agreed upon.