Refer to Figure 8.6,which shows just three of a firm's various possible short-run average cost curves.Suppose the firm increases its output from 130 units to 160 units.Which of the following statements is true?
A) The average cost of producing the 160 units would be $90 if the firm expected the increase in production to be permanent.
B) The average cost of producing the 160 units would be $80 if the firm expected the increase in production to be permanent.
C) The average cost of producing the 160 units would be $175 if the firm expected the increase in production to be temporary.
D) The average cost of producing the 160 units would be $80 if the firm expected the increase in production to be temporary.

Question

Refer to Figure 8.6,which shows just three of a firm's various possible short-run average cost curves.Suppose the firm increases its output from 130 units to 160 units.Which of the following statements is true? 
A) The average cost of producing the 160 units would be $90 if the firm expected the increase in production to be permanent. 
B) The average cost of producing the 160 units would be $80 if the firm expected the increase in production to be permanent. 
C) The average cost of producing the 160 units would be $175 if the firm expected the increase in production to be temporary. 
D) The average cost of producing the 160 units would be $80 if the firm expected the increase in production to be temporary.

Quizplus · Accepted Answer

The Answer of Refer to Figure 8.6,which shows just three of a firm's various possible short-run average cost curves.Suppose the firm increases its output from 130 units to 160 units.Which of the following statements is true? 
A) The average cost of producing the 160 units would be $90 if the firm expected the increase in production to be permanent. 
B) The average cost of producing the 160 units would be $80 if the firm expected the increase in production to be permanent. 
C) The average cost of producing the 160 units would be $175 if the firm expected the increase in production to be temporary. 
D) The average cost of producing the 160 units would be $80 if the firm expected the increase in production to be temporary.