The formula for average variable cost (AVC) is ?

Related Mcqs:

1. When average cost is falling marginal cost is ________ and when average cost is rising marginal cost is?

   A. greater than average cost, greater than average cost
   B. less than average cost, greater than average cost
   C. less than average cost, less than average cost
   D. greater than average cost, less than average cost

2. The short run marginal cost curve cuts the short run total cost curve and short run average variable cost curve ?

   A. At their lowest points
   B. When they are declining
   C. When they are increasing
   D. When marginal revenue is zero

3. In the short run, the competitive firm’s supply curve is the portion of the marginal cost curve that lies above the average variable cost curve?

   A. Upward-sloping portion of the average total cost curve
   B. upward-sloping portion of the average variable cost curve
   C. portion of the marginal cost curve that lies above the average total cost curve.
   D. entire marginal cost curve.
   E. portion of the marginal-cost curve that lies above the average variable cost curve

4. If the price is less than the average costs but higher than the average variable costs ?

   A. The firm is making a loss and will shutdown in the short term
   B. The firm is making a profile
   C. The firm is making a loss but will continue to produce in the short term
   D. The firm is making a loss and is making a negative contribution to fixed costs

5. The average variable cost curve ?

   A. is derived from the average fixed costs
   B. Converges with the average cost as output increases
   C. Equals the total costs divided by the output
   D. Equals revenue minus profits

6. The formula for average fixed costs is ?

   A. Dq/DTFC
   B. TFC – q
   C. TFC/q
   D. q/TFC

7. -7-+47-+45-+-+Since people respond to incentives, we would expect that if the average salary of accountants increases by 50% while the average salary of teachers increase by 20% then ?

   A. Fewer students will take degree courses in education and more will take accounting courses.
   B. fewer students will take degree courses in education and more will take accounting courses
   C. fewer students will attend university
   D. None of these

8. Which of the following is most likely to be a variable cost for a firm ?

   A. The franchiser’s fee that a restaurant must pay to the national restaurant chain
   B. The payroll taxes that are paid on employee wages.
   C. The monthly rent on office space that it leased for a year
   D. The interest payments made on loans.

9. A firm in perfectly competitive industry is producing 50 units, its profit-maximising quantity. Industry price is £2 and total fixed costs and total variable cost are £25 and £40 respectively. The firm’s economic profit is ?

   A. £35
   B. £15
   C. £30
   D. £60

10. Suppose Handel’s Ice Cream experiences economies of scale up to a certain point and diseconomies of scale beyond that point. Its long-run average cost curve is most likely to be ?

    A. downward sloping to the right
    B. U-shaped
    C. Horizontal
    D. upward sloping to the right