In the above figure, the line represented by the "1" is the
A) average fixed cost.
B) marginal revenue.
C) total cost.
D) average total cost.
B
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Natural gas is a natural monopoly. The figure above shows the market for natural gas in the city of Lucknow. When a marginal cost pricing rule regulation is imposed, the price per household per month is ________
A) $30 and 20,000 household are served B) $10 and 40,000 household are served C) $10 and 20,000 household are served D) $20 and 30,000 households are served
Suppose a competitive firm is paying a wage of $12 an hour. Assume that labor is the only input. If hiring another worker would increase output by four units per hour, then to maximize profits the firm should
A) layoff some workers. B) not change the number of workers it currently hires. C) hire the extra worker. D) There is not enough information to answer the question.