Cost Chapter

Fixed costs are also known as

• Supplementary costs

• Overhead costs

• Indirect costs

• All of the above

When production level is zero, TC will be:

• Zero

• Equal to fixed cost

• Equal to variable cost

• Equal to marginal cost

Per unit of good is called?

• Fixed cost

• Average cost

• Variable cost

• Unitary cost

TC increases at an increasing rate when MC is:

• Constant

• decreasing

• Increasing

• Negative

The average cost is 20$ and it is minimum when 4 units are produced. The MC of producing 4 units is:

• 20$

• 24$

• 5$

• 0$

What is the shape of the AC curve?

• C-shaped

• U-shaped

• like a tick mark

• Horizontal line

Even when the firm stops producing, they have to incur the loss of fixed costs

• True

• False

Marginal cost can never be constant

• True

• False

This cost incurs when production actually starts

• Variable costs

• Fixed costs

• Average costs

• Marginal cost