The Relationship Between the Long-Run Total Cost Curve and the Marginal

question 36

Multiple Choice

The relationship between the long-run total cost curve and the marginal and average cost curves is best described by which of the following statements?

• A)The slope of the total cost curve from the origin to a point on the total cost curve is how you derive the marginal cost curve while the average cost is given by TC/Q.
• B)Marginal cost is MC/Q while average cost is TC/Q.
• C)Marginal cost is derived by dividing total cost by a constant as is average cost.
• D)The slope of the total cost curve at each point is how you derive the marginal cost curve while the slope from the origin to a point on the total cost curve is how you derive the average cost curve.

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Definitions:

UCC

Refers to the Uniform Commercial Code, a set of laws that govern commercial transactions in the United States.

Sarbanes-Oxley Act

A U.S. law enacted in 2002 to protect investors by improving the accuracy and reliability of corporate disclosures.

Supply Management

A strategic approach to planning, procuring, and coordinating materials and services needed to support company operations.

Off-Balance Sheet Items

Financial obligations or assets not recorded on a company's balance sheet, often involving potential liabilities.