Cost Analysis

Costs are function of:

• Supply

• Production

• Technology

• Product prices

Fixed costs are found in ____ run.

• Short

• Medium

• Long

• Wrong question

According to the traditional theorists, cost curves are ____ shaped.

• S

• V

• U

• Inverted U

In the long run all costs are:

• fixed

• total

• average

• variable

Which of the following curves declines continuously?

• AFC

• AVC

• MC

• STC

Long run cost curves are U shaped because of:

• Economies of Scale

• Diseconomies of scale

• Both economies and diseconomies of scale

• no specific reason

According to the modern theory of costs, the short run costs are ____ shaped because of:

• Technological factor

• Policy of the firm

• market condition

• None of the three

According to the modern theory, the long run cost curve has a ___ shape.

• K

• S

• U

• L

The supply curve of a firm is derived from its:

• AC curve

• Production curve

• MC curve

• sales curve

For equilibrium of a profit maximizing firm, the necessary condition is:

• MC=MR

• AC=AR

• MC=AR

• MR=AC