Which of the Following Is True in the Short Run

question 130

Multiple Choice

Which of the following is true in the short run at the output level where average total cost is at its minimum?

• A)Marginal cost equals average total cost.
• B)Average variable cost equals fixed cost.
• C)Marginal cost equals average variable cost.
• D)Average total cost equals average fixed cost.
• E)Average total cost equals average variable cost.

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Definitions:

Activity-Based Costing

A method of cost accounting that identifies activities in an organization and assigns the cost of each activity to all products and services according to the actual consumption by each.

Product Q1

Designates the first quarter's product or output in a company's fiscal year.

Product Q19S

A designated name or code for a specific product, suggesting a unique item or version offered by a company.

Machine-Hours

A measure of production activity that indicates the amount of time machines are used in the manufacturing process.