Why is average variable cost curve U shaped Mcq?

69.What best explains a shift in market supply curve to the right?A. An advertising campaign is successful in promoting the goodB. A new technique makes it cheaper to produce the

Why is average variable cost curve U shaped Mcq?

69.What best explains a shift in market supply curve to the right?

A.  An advertising campaign is successful in promoting the good

B.  A new technique makes it cheaper to produce the good

C.  The government introduces a tax on the good

D.  The price of raw materials increases

Answer & Solution Discuss in Board Save for Later

Answer & SolutionAnswer: Option BSolution:A new technique makes it cheaper to produce the good best explains a shift in market supply curve to the right. A rightward shift in the supply curve, say from a new production technology, leads to a lower equilibrium price and a greater quantity.

70.Total costs in the short-term are classified into fixed costs and variable costs. Which one of the following is a variable cost?

A.  Cost of raw material

B.  Cost of equipment

C.  Interest payment on past borrowing

D.  Payment of rent on buildings

Answer & Solution Discuss in Board Save for Later

Answer & SolutionAnswer: Option ASolution:Total costs in the short-term are classified into fixed costs and variable costs. Cost of raw material is a variable cost. Variable costs vary based on the amount of output, while fixed costs are the same regardless of production output.
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69.What best explains a shift in market supply curve to the right?

A.  An advertising campaign is successful in promoting the good

B.  A new technique makes it cheaper to produce the good

C.  The government introduces a tax on the good

D.  The price of raw materials increases

Answer & Solution Discuss in Board Save for Later

Answer & SolutionAnswer: Option BSolution:A new technique makes it cheaper to produce the good best explains a shift in market supply curve to the right. A rightward shift in the supply curve, say from a new production technology, leads to a lower equilibrium price and a greater quantity.

70.Total costs in the short-term are classified into fixed costs and variable costs. Which one of the following is a variable cost?

A.  Cost of raw material

B.  Cost of equipment

C.  Interest payment on past borrowing

D.  Payment of rent on buildings

Answer & Solution Discuss in Board Save for Later

Answer & SolutionAnswer: Option ASolution:Total costs in the short-term are classified into fixed costs and variable costs. Cost of raw material is a variable cost. Variable costs vary based on the amount of output, while fixed costs are the same regardless of production output.

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