Cost Curves

Assume that the fixed cost is $50. Based on the cost and output data in the table, what is the marginal cost when the firm increases its output from three to four units AND the average total cost of producing 4 units (respectively)? 

• MC=$35; ATC=$40

• MC=$35; ATC=$35

• MC=$25; ATC=$35

• MC=$25; ATC=$25

The graph above shows the marginal product (MP) and the average product (AP) of labor for a firm that uses labor as the only variable input. At which quantity of labor does marginal cost change from decreasing to increasing?

• L1

• L2

• L3

• L5

What is the graphical representation of costs and output called?

• Cost curves

• Supply curves

• Demand curves

• Profit curves

• A

• B

• C

• D

• E

• A

• B

• C

• D

• E

• A

• B

• C

• D

• E

• A

• B

• C

• D

• E

On the basis of the data table above, what is the marginal cost of the third unit of output.

• 40

• 50

• 60

• 90

• 130

What is the O.C. of moving from B to D?

• 100 Ipads

• 200 Iphones

• 150 Ipads

• 100 Iphones

What is the Opportunity Cost of moving from B to E?