Short Run Costs 7.3-11 ~ Benjamin Rainwater Flashcards Preview

Econ 2106 Exam 2 > Short Run Costs 7.3-11 ~ Benjamin Rainwater > Flashcards

Flashcards in Short Run Costs 7.3-11 ~ Benjamin Rainwater Deck (12)
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1
Q

An increase in the price of the variable input results in…

A

AVC (average variable cost),

ATC (average total cost) and MC (marginal cost) moving up together

2
Q

When variable price increases, do the curves change shape?

A

No

3
Q

An increase in the price of the fixed input results in

A

only the ATC moving up

4
Q

An improvement in technology shifts one or more of the cost curves down/up?

A

down

5
Q
Average Variable Cost (AVC)
and Average Total Cost (ATC)
are u-shaped curves and the
vertical difference between them
is?
A

Average Fixed Costs (AFC)

6
Q

AFC (average fixed cost)
decreases/increases as quantity
increases?

A

decreases

7
Q

AFC (average fixed cost)
and this decreases as quantity
increases intersect at what point?

A

at their minimum
points by Marginal Cost (MC),
which slopes upward.

8
Q

If the price of the fixed input
increases only the (?) moves
upwards

A

ATC curve

9
Q

If technology improves one or

more of the cost curves move downward/upward?

A

downward

10
Q

The difference between ATC and AVC is?

A

AFC

11
Q

ATC means

A

Average Total Costs

12
Q

AFC+AVC=

A

ATC