Narrative 5-1 The Following Question(s)refer to the This Equation Analyzing the Relationship

question 68

Multiple Choice

Narrative 5-1
The following question(s) refer to the this equation analyzing the relationship of total cost to changes in machine hours.The following relationship was determined:
TC = $2,200 + $3X
Refer to Narrative 5-1.Which of the following terms best describes the equation?

• A)parabolic.
• B)curvilinear.
• C)linear.
• D)probabilistic.

---

Definitions:

Profitable

Generating revenue that exceeds the costs and expenses involved in operating.

Long-Run Equilibrium

Long-run equilibrium occurs in a market when supply equals demand over time, allowing all participants to adjust fully to any changes.

Average Total Cost

The total cost of production (fixed and variable costs combined) divided by the quantity of output produced.

Price Takers

Price takers are participants in a market who must accept prevailing prices and cannot influence them due to their small market share.