FIGURE 11-2 -Refer to Figure 11-2.In Diagram B,the Firm's Short-Run Supply Curve

question 12

Multiple Choice

FIGURE 11-2
-Refer to Figure 11-2.In diagram B,the firm's short-run supply curve is

• A)ATC above AVC.
• B)MC above AVC.
• C)MC above ATC.
• D)AR.
• E)MC.

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Definitions:

Selling Costs

All costs that are incurred to secure customer orders and get the finished product or service into the hands of the customer.

Indirect Costs

Costs that are not directly traceable to a single product or operation, such as overhead.

Opportunity Costs

The potential benefit missed out on when choosing one alternative over another.

Conversion Cost

Conversion cost is the sum of direct labor and manufacturing overhead costs incurred to convert raw materials into finished goods.