The Table Given Below Shows the Average Total Cost of Production

question 78

Multiple Choice

The table given below shows the average total cost of production of a firm at different levels of the output.Table 8.5

-As the output produced by a firm increases, the average fixed cost:

• A)continues to decline.
• B)initially increases, and then declines.
• C)quickly drops to zero.
• D)becomes constant.
• E)declines and finally becomes negative.

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Definitions:

Net Exports

The balance of a nation's trade, measured by subtracting its imports from its exports of goods and services.

Depreciation

The process of allocating the cost of a tangible or physical asset over its useful life, reflecting the decrease in value of an asset over time due to use, wear and tear, or obsolescence.

Gross Private Domestic Investment

The total spending on capital goods by private businesses and households within a country's economy, not including expenditures by the government.

Capital

Refers to financial assets or the financial value of assets, such as machinery and buildings, used in producing goods and services.