Short-Run Cost Curves (Part 2)- Micro Topic 3.2

Mr. Clifford introduces cost curves in economics, recapping fixed, variable, total, and marginal costs. He explains how to graph these costs and highlights the importance of per unit cost curves, such as marginal and average costs. The video demonstrates using graphs to calculate costs, providing examples and emphasizing the significance of marginal and average total costs.

What are the components that make up the total cost in a cost curve?

• Fixed cost and marginal cost

• Variable cost and marginal cost

• Fixed cost and variable cost

• Total cost and average cost

Why does the average fixed cost curve keep decreasing?

• Because fixed costs increase with quantity

• Because fixed costs remain constant

• Because fixed costs decrease with quantity

• Because fixed costs are divided by increasing quantities

At what point does the average variable cost curve intersect with the marginal cost curve?

• At the minimum point of marginal cost

• At the maximum point of marginal cost

• At the minimum point of average variable cost

• At the maximum point of average variable cost

How can you determine the total cost of producing a specific number of units using the graph?

• By dividing the total cost by the number of units

• By multiplying the average total cost by the number of units

• By subtracting the average fixed cost from the average total cost

• By adding the fixed cost to the variable cost

Which cost curves are considered the most important for drawing and analysis?

• Average fixed cost and average variable cost

• Marginal cost and average total cost

• Total cost and variable cost

• Fixed cost and marginal cost