Exhibit 21-9

-Refer to Exhibit 21-9. Let MC₁ and ATC₁ represent the initial cost curves of an aluminum can producer. In which of the following cases is it most likely that the curves will shift rightward from MC₁, and ATC₁ to MC₃ and ATC₃?

Question

Exhibit 21-9

-Refer to Exhibit 21-9. Let MC₁ and ATC₁ represent the initial cost curves of an aluminum can producer. In which of the following cases is it most likely that the curves will shift rightward from MC₁, and ATC₁ to MC₃ and ATC₃?

Quizplus · Accepted Answer

A rightward shift in the marginal cost (MC) and average total cost (ATC) curves typically indicates a decrease in production costs. Among the options provided, a new supplier offering to supply aluminum at a lower price (option C) would directly reduce the cost of raw materials, leading to a decrease in both marginal and average total costs for producing aluminum cans. Options A and B would increase costs, not decrease them.

Exhibit 21-9 ​

Exhibit 21-9