Average Variable Cost Is the Ratio Of

question 210

Multiple Choice

Average variable cost is the ratio of:

• A)total cost to marginal cost.
• B)total cost to the amount of variable input.
• C)variable cost to the quantity of output.
• D)marginal cost to the quantity of output.

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Definitions:

Total Revenue

Total financial gains received by a firm from its commercial sales and service operations throughout a defined period.

Elastic

A characteristic of a supply or demand curve that describes how much the quantity supplied or demanded responds to changes in price.

Unit Elastic

A situation when a change in price leads to an equal proportional change in quantity demanded or supplied.

Elasticity of Demand

A gauge of the degree to which a change in price impacts the demanded amount of a good or service.