Consider a firm's short- run cost curves.Which one of the following types of cost declines over the whole range of output?
A)total fixed cost
B)average variable cost
C)total variable cost
D)marginal cost
E)average fixed cost

Question

Quizplus · Accepted Answer

Average fixed cost declines over the whole range of output because it is calculated by dividing total fixed cost by the quantity of output, meaning that as output increases, average fixed cost decreases. This is due to the fixed cost being spread over a greater quantity of output, resulting in a lower per-unit cost.

Consider a Firm's Short- Run Cost Curves