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Define and Graph Fixed, Variable, Average, and Marginal Costs

Question 20

Essay

Define and graph fixed, variable, average, and marginal costs.
-Explain how and whether each of the following would affect short-run marginal, variable, fixed, and total costs:
a. wage rate paid to assembly-line workers increases
b. salary paid to upper management increases
c. firm is required to implement new environmental controls
d. price of oil decreases
e. demand falls, so firm cuts back on production
f. property taxes rise
g. demand increases, so firm pays workers overtime

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