In Defining a Firm's Long-Run Average Cost Curve

question 104

Multiple Choice

In defining a firm's long-run average cost curve,

• A)factor prices are held constant and technology is assumed to change.
• B)factor prices are held constant and the quantity of factors of production used is varied.
• C)factor prices are varied and the quantity of factors of production is held constant.
• D)technology,factor prices,and the quantity of factors of production are all varied.
• E)the time period must be longer than one year.

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Definitions:

Average Fixed Cost

When you divide the unchanging production costs by the total units produced, this value diminishes as the level of production goes up.

Mixers

Devices or software used to combine, adjust, and control the levels of different audio signals.

Average Fixed Cost

The constant expenses associated with manufacturing divided by the amount of product created.

Mixers

Devices used to blend or mix various ingredients together, common in food processing and preparation.