-Refer to Figure 8

question 43

Multiple Choice

-Refer to Figure 8.6,which shows just three of a firm's various possible short-run average cost curves.Suppose the firm increases its output from 130 units to 160 units.Which of the following statements is true?

• A) The average cost of producing the 160 units would be $90 if the firm expected the increase in production to be permanent
• B) The average cost of producing the 160 units would be $80 if the firm expected the increase in production to be permanent
• C) The average cost of producing the 160 units would be $175 if the firm expected the increase in production to be temporary
• D) The average cost of producing the 160 units would be $80 if the firm expected the increase in production to be temporary

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Definitions:

Salvage Value

Salvage value is the estimated residual value of an asset at the end of its useful life, assuming there is still value left after its primary use is over.

Ore Sold

The total volume or revenue generated from selling mined materials before they are refined or processed.

Depletion

The allocation of the cost of natural resources over their useful lives in a manner similar to depreciation of physical assets.

Uniform Grade

A standardization in the quality or level of a product, making it consistent across different units or batches.