Suppose that there are just two firms in a small market.
Acme Manufacturing's Total Costs equal $100 + $3 × Quantity.
Generic Industries' Total Costs equal $500 + $3 × Quantity.
Refer to the information given above.If each firm is producing the same quantity:
A) Acme has lower average total costs than Generic.
B) Acme's average total costs are equal to Generic's variable costs.
C) Acme has higher average total costs than Generic.
D) at some levels of output,Acme's average total costs are less than Generic's,but at some levels of output,Generic's average costs are less than Acme's.
Correct Answer:
Verified
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