The Table Given Below Shows the Total Fixed and Variable

question 31

Multiple Choice

The table given below shows the total fixed and variable costs of a firm. Table 21.3
Using the information in Table 21.3 we can conclude that the marginal-cost curve intersects the average-variable-cost curve at ____ unit(s) of output.

• A)1
• B)2
• C)5
• D)4

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Definitions:

Bundle

A combination or collection of goods or services that is considered as a single unit by consumers or businesses.

Cobb-Douglas Utility

A specific form of utility function used in economics to represent preferences of consumers, characterized by a functional form that is a particular type of product of goods' amounts raised to various powers.

Compensating Variation

An economic concept referring to the amount of money one would need to attain the same level of utility after a price change.

Equivalent Variation

A measure in economics that calculates the change in wealth needed to reach utility before a price change, preserving consumer satisfaction levels.