Short-Run Cost Curves for a Firm Are Eventually Upward-Sloping Because

question 122

Multiple Choice

Short-run cost curves for a firm are eventually upward-sloping because of the effects of

• A)the increasing price of variable inputs.
• B)diminishing marginal product.
• C)increasing fixed costs.
• D)increasing marginal productivity of the variable inputs.
• E)decreasing total product.

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Definitions:

Average Sale Period

The average time it takes for a company to convert its inventory into sales, often used in analyzing a company's efficiency.

Cost of Goods Sold

The direct costs attributable to the production of goods sold by a company, including the cost of the materials and labor directly used to create the good.

Beginning Inventory

The value of goods available for sale at the start of an accounting period.

Inventory Turnover

A ratio indicating how many times a company has sold and replaced inventory during a certain period of time.