The Below Figure Shows the Various Combinations of the Goods

question 16

Multiple Choice

The below figure shows the various combinations of the goods X and Y that yield different levels of utility.Figure 7.3

-If an average cost curve is U-shaped, then:

• A)costs per unit remainconstant throughout the entire range of production.
• B)costs per unit fall throughout the entire range of production.
• C)costs per unit increase throughout the entire range of production.
• D)costs per unit first rise, then reach a maximum, and then begin to fall as output is increased.
• E)costs per unit first fall, then reach a minimum, and then increase as output is increased.