PRC-3 · Chapter 12 · Question 54 of 69
Which of the following statements regarding short-run cost curves is mathematically correct?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: A) Marginal Cost (MC) will equal Average Total Cost (ATC) exactly when ATC is at its minimum point
Explanation
It is a fundamental mathematical property of average/marginal relationships that the marginal curve will always intersect the average curve exactly at the average's lowest point.
More Firm Theory MCQs
- Q56For a downward-sloping demand curve, the firm's Marginal Revenue (MR) is strictly greater than zero only if:
- Q57By substituting the Total Revenue (TR) equation into the Average Revenue (AR) formula, we mathematically observe that AR is always equal to:
- Q58Price discrimination by a monopoly (charging different prices to different groups) is impossible or highly ineffective if:
- Q59Which of the following is NOT a fundamental characteristic of an Oligopoly market structure?
- Q60For a firm operating with a downward-sloping demand curve, its Total Revenue (TR) reaches its absolute mathematical maximum exactly when: