If $S T C = 200 + 2 q + 4 q ^ { 2 }$

question 9

Multiple Choice

If $S T C = 200 + 2 q + 4 q ^ { 2 }$ and $S M C = 2 + 8 q$ where q is output, what is the minimum level of average variable cost?

• A) 0
• B) 2
• C) 6
• D) 8

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Definitions:

Franchise

A business model where a business owner (franchisor) grants others (franchisees) the right to use its brand, product, or system in exchange for a fee.

Working Capital

The difference between a company's current assets and current liabilities, indicating the short-term liquidity and operational efficiency of the business.

Net Present Value

A method used in capital budgeting to evaluate the profitability of an investment or project, based on the sum of the present values of all cash flows associated with it.

Required Rate

The minimum expected return by investors to compensate for the risks of an investment.