Refer to Figure 8.6,which shows just three of a firm's various possible short-run average cost curves.Suppose the firm is currently producing 160 units at an average cost of $90 per unit.Which of the following statements is true?
A) The firm could reduce its short-run average cost by producing more output.
B) The firm could reduce its short-run average cost by producing less output.
C) The firm is producing the level of output that minimizes short-run average cost.
D) The firm is producing its output at the lowest possible long-run average cost.

Question

Refer to Figure 8.6,which shows just three of a firm's various possible short-run average cost curves.Suppose the firm is currently producing 160 units at an average cost of $90 per unit.Which of the following statements is true? 
A) The firm could reduce its short-run average cost by producing more output. 
B) The firm could reduce its short-run average cost by producing less output. 
C) The firm is producing the level of output that minimizes short-run average cost. 
D) The firm is producing its output at the lowest possible long-run average cost.

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 is currently producing 160 units at an average cost of $90 per unit.Which of the following statements is true? 
A) The firm could reduce its short-run average cost by producing more output. 
B) The firm could reduce its short-run average cost by producing less output. 
C) The firm is producing the level of output that minimizes short-run average cost. 
D) The firm is producing its output at the lowest possible long-run average cost.