The diagram above represents the total production cost of a car manufacturer. Which of the following statements correctly describes the cost of production? Select one: O a. a. The marginal cost decreases as total output increases. O b. Production of cars requires $80,000 as fixed costs. O c. The average cost increases and then decreases as total output increases. d. The average cost when producing 40 cars is $140,000.
The diagram above represents the total production cost of a car manufacturer. Which of the following statements correctly describes the cost of production? Select one: O a. a. The marginal cost decreases as total output increases. O b. Production of cars requires $80,000 as fixed costs. O c. The average cost increases and then decreases as total output increases. d. The average cost when producing 40 cars is $140,000.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Related questions
Question
![Total cost of production, C(Q) ($)
350,000
240,000
140,000
80,000
F
A
20
Quantity of cars, Q
B
40
The diagram above represents the total production cost of a car
manufacturer. Which of the following statements correctly describes the
cost of production?
Select one:
a. The marginal cost decreases as total output increases.
b. Production of cars requires $80,000 as fixed costs.
c.
The average cost increases and then decreases as total output
increases.
O d. The average cost when producing 40 cars is $140,000.
e. The average cost when producing 60 cars is $4,000.
D
60](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F1ee51cd1-c9eb-4628-9b55-6645bae64060%2F43c16896-b9ae-44ea-854e-fb925b64edf2%2Fqewvb1m_processed.png&w=3840&q=75)
Transcribed Image Text:Total cost of production, C(Q) ($)
350,000
240,000
140,000
80,000
F
A
20
Quantity of cars, Q
B
40
The diagram above represents the total production cost of a car
manufacturer. Which of the following statements correctly describes the
cost of production?
Select one:
a. The marginal cost decreases as total output increases.
b. Production of cars requires $80,000 as fixed costs.
c.
The average cost increases and then decreases as total output
increases.
O d. The average cost when producing 40 cars is $140,000.
e. The average cost when producing 60 cars is $4,000.
D
60
Expert Solution
![](/static/compass_v2/shared-icons/check-mark.png)
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 3 steps with 3 images
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.Recommended textbooks for you
![ENGR.ECONOMIC ANALYSIS](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9780190931919/9780190931919_smallCoverImage.gif)
![Principles of Economics (12th Edition)](https://www.bartleby.com/isbn_cover_images/9780134078779/9780134078779_smallCoverImage.gif)
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
![Engineering Economy (17th Edition)](https://www.bartleby.com/isbn_cover_images/9780134870069/9780134870069_smallCoverImage.gif)
Engineering Economy (17th Edition)
Economics
ISBN:
9780134870069
Author:
William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:
PEARSON
![ENGR.ECONOMIC ANALYSIS](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9780190931919/9780190931919_smallCoverImage.gif)
![Principles of Economics (12th Edition)](https://www.bartleby.com/isbn_cover_images/9780134078779/9780134078779_smallCoverImage.gif)
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
![Engineering Economy (17th Edition)](https://www.bartleby.com/isbn_cover_images/9780134870069/9780134870069_smallCoverImage.gif)
Engineering Economy (17th Edition)
Economics
ISBN:
9780134870069
Author:
William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:
PEARSON
![Principles of Economics (MindTap Course List)](https://www.bartleby.com/isbn_cover_images/9781305585126/9781305585126_smallCoverImage.gif)
Principles of Economics (MindTap Course List)
Economics
ISBN:
9781305585126
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
![Managerial Economics: A Problem Solving Approach](https://www.bartleby.com/isbn_cover_images/9781337106665/9781337106665_smallCoverImage.gif)
Managerial Economics: A Problem Solving Approach
Economics
ISBN:
9781337106665
Author:
Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:
Cengage Learning
![Managerial Economics & Business Strategy (Mcgraw-…](https://www.bartleby.com/isbn_cover_images/9781259290619/9781259290619_smallCoverImage.gif)
Managerial Economics & Business Strategy (Mcgraw-…
Economics
ISBN:
9781259290619
Author:
Michael Baye, Jeff Prince
Publisher:
McGraw-Hill Education