Asked by Joshua Najera on May 04, 2024
Verified
Refer to Table 13-15. What is the shape of the average-variable-cost curve?
Average-Variable-Cost Curve
A graphical representation showing how the average variable cost of production changes as the quantity of output is altered.
- Examine and delineate the configuration of cost curves, covering total cost, average total cost, average fixed cost, average variable cost, and marginal cost.
Verified Answer
ZK
Zybrea KnightMay 06, 2024
Final Answer :
AVC = VC/Q, where VC is graphed on the vertical axis and Q (not labor) is graphed on the horizontal axis. For the range of output specified in the table, as output increases, AVC first decreases, then increases ($0.05, $0.04, $0.04, $0.05, $0.06, $0.07). AVC is U-shaped.
Learning Objectives
- Examine and delineate the configuration of cost curves, covering total cost, average total cost, average fixed cost, average variable cost, and marginal cost.