Exhibit

-Refer to Exhibit. Which of the following is true?

Question

Exhibit
 
-Refer to Exhibit. Which of the following is true?

Quizplus · Accepted Answer

The marginal cost is the change in total cost divided by the change in output. The third unit has the lowest marginal cost because the change in total cost from the second to the third unit is $2, while the change in output is 1. The sixth unit has the highest marginal cost because the change in total cost from the fifth to the sixth unit is $4, while the change in output is 1. Average variable cost is total variable cost divided by output. Total variable cost is the sum of all variable costs, which in this case is only labor costs. Average variable cost falls for the first 5 units because the total variable cost increases by less than the output. Average variable cost rises with the 6th unit because the total variable cost increases by more than the output.

Exhibit -Refer to Exhibit. Which of the Following Is True