22. Suppose that the term C in the total cost function changes to a new figure that is twice as large. Thinking about the cost curves drawn on a graph, we would expect the following to happen (choose the best answer): A) B) C) D) E) F) 23. Use the information about the total cost function supplied above. The marginal cost curve will shift or rotate whenever (choose the best answer): A) B) Both the average variable cost curve AND the average cost curve shift (or rotate) down. Both the average variable cost curve AND the average cost curve shift (or rotate) up. The average cost curve shifts (or rotates) down. The average cost curve shifts (or rotates) up. The level of quantity where average cost is minimized falls. The level of quantity where average cost is minimized rises. Statements A & E are true. Statements B & F are true. Statements C & E are true. Statements D & F are true. C) D) E) The A term changes. The B term changes. The C term changes. The D term changes. All of the above statements are true.
22. Suppose that the term C in the total cost function changes to a new figure that is twice as large. Thinking about the cost curves drawn on a graph, we would expect the following to happen (choose the best answer): A) B) C) D) E) F) 23. Use the information about the total cost function supplied above. The marginal cost curve will shift or rotate whenever (choose the best answer): A) B) Both the average variable cost curve AND the average cost curve shift (or rotate) down. Both the average variable cost curve AND the average cost curve shift (or rotate) up. The average cost curve shifts (or rotates) down. The average cost curve shifts (or rotates) up. The level of quantity where average cost is minimized falls. The level of quantity where average cost is minimized rises. Statements A & E are true. Statements B & F are true. Statements C & E are true. Statements D & F are true. C) D) E) The A term changes. The B term changes. The C term changes. The D term changes. All of the above statements are true.
Essentials of Economics (MindTap Course List)
8th Edition
ISBN:9781337091992
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter12: The Cost Of Production
Section: Chapter Questions
Problem 3CQQ
Related questions
Question
Transcribed Image Text:22-23. Use this information to answer questions 22 and 23. A typical firm has a total cost
function given by: TC = A.Q² + B.Q+ (C+D), where A, B, C & D are all positive constants and
the term D represents the firm's fixed costs.
22. Suppose that the term C in the total cost function changes to a new figure that is twice as
large. Thinking about the cost curves drawn on a graph, we would expect the following to
happen (choose the best answer):
A)
B)
H)
I)
J)
ABOADAGAS
23. Use the information about the total cost function supplied above. The marginal cost curve
will shift or rotate whenever (choose the best answer):
A)
B)
C)
D)
H)
I)
Both the average variable cost curve AND the average cost curve shift (or rotate) down.
Both the average variable cost curve AND the average cost curve shift (or rotate) up.
The average cost curve shifts (or rotates) down.
The average cost curve shifts (or rotates) up.
J)
The level of quantity where average cost is minimized falls.
The level of quantity where average cost is minimized rises.
Statements A & E are true.
Statements B & F are true.
Statements C & E are true.
Statements D & F are true.
The A term changes.
The B term changes.
The C term changes.
The D term changes.
All of the above statements are true.
Statements A & B are true
Statements B & C are true.
Statements C & D are true.
Statements A, B & C are true.
Statements B, C & D are true.
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