Average Total Cost Is the Ratio Of

question 92

Multiple Choice

Average total cost is the ratio of:

• A) total cost to the marginal cost.
• B) total cost to the quantity of output.
• C) total cost to the amount of variable input.
• D) marginal cost to the amount of variable input.

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Definitions:

Capital Goods

Long-term assets used by businesses to produce goods and services, such as machinery and buildings.

Consumer Goods

Items produced for direct consumption by the end consumer.

Production Possibilities Curve

An illustrative chart that depicts the optimal mix of two goods or services that can be produced by an economy when it fully and efficiently employs all available resources.

Society's Production

The total output of goods and services produced by all sectors within a society or economy.