The Figure Given Below Shows Three Short Run Average Total

question 13

True/False

The figure given below shows three Short Run Average Total Cost (SRATC) curves and the Long Run Average Total Cost (LRATC) curve of a firm.Figure 8.3

-In the long run, if the output of a firm is zero then its total cost will be equal to its total fixed cost.

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Definitions:

Desired Rate of Return

The return a investor expects to achieve from an investment.

Net Present Value

The difference between the present value of cash inflows and the present value of cash outflows over a period of time, used in capital budgeting to assess the profitability of investments.

Manufacturing Machinery

The equipment and machines used in the process of producing goods in manufacturing facilities.

Future Cash Flows

Estimates of future financial transactions that involve the inflow or outflow of money from a particular operation or investment.