The short-run average ﬁxed cost, average variable cost and average total cost curves are U-shaped.

Name: The short-run average ﬁxed cost, average variable cost and average total cost curves are U-shaped.
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Question

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The short-run average fixed cost (AFC) curve is not U-shaped; it continuously declines as output increases. However, the average variable cost (AVC) and average total cost (ATC) curves can be U-shaped due to the law of diminishing returns.

The Short-Run Average ﬁXed Cost, Average Variable Cost and Average