The Table Given Below Shows the Average Total Cost of Production

question 9

Multiple Choice

The table given below shows the average total cost of production of a firm at different levels of the output.Table 8.5

-The law of diminishing return does not apply to a firm in the long run because in this phase:

• A)all the factors of production are fixed.
• B)there are no fixed factors of production.
• C)there are some fixed and some variable factors of production.
• D)the producer is required to produce a fixed level of output.
• E)the producer can change the level of output only by changing the variable factors, fixed factors remaining unchanged.

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Definitions:

Example

An instance or case that is representative of a concept or demonstrates a particular situation or principle.

Net Present Value

A financial metric used to evaluate the profitability of an investment, calculated by subtracting the present value of cash outflows from the present value of cash inflows over a period.

Annual Revenue

The total amount of money earned from the sale of goods or services in a fiscal year before any expenses are subtracted.

Annual Expenses

The total amount of money spent or costs incurred by a business or individual in a one-year period.