If Activity Level Increases,what Happens to the Total Variable Cost

question 22

Multiple Choice

If activity level increases,what happens to the total variable cost?

• A)It remains the same.
• B)It decreases.
• C)It increases.
• D)It depends on how much the activity level increases.

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Definitions:

Producer Surplus

The difference between what producers are willing to sell a good for and the actual price they receive.

Autarky

A financial strategy or condition where a nation is independent and refrains from participating in global commerce.

Free Trade

Trade that is unregulated by government tariffs or other artificial barriers; the levels of exports and imports occur naturally, as a result of supply and demand.

Consumer Surplus

The variance between the amount consumers are ready to pay for a good or service compared to the actual price they pay.