If marginal cost equals average total cost:
A. average total cost is minimized.
B. average variable cost is falling.
C. marginal cost is minimized.
D. average variable cost is minimized.
Answer: A
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Which of the following changes best represents the effect of the oil embargo (a shut-off of oil from certain OPEC countries) of the 1970s on the U.S.?
a. A leftward shift of the long-run aggregate supply curve b. A rightward shift of the long-run aggregate supply curve c. A leftward shift of the aggregate demand curve d. A rightward shift of the aggregate demand curve e. A rightward movement along a given aggregate demand curve
If the economy is expecting a severe recession, which fiscal policy would you recommend?
A. Reduce spending for welfare programs. B. Reduce overall government spending. C. Increase taxes to reduce consumption. D. Reduce personal and corporate income taxes.