The minimum average cost of producing alternate levels of output,allowing for optimal selection of all variables of production is defined by the:
A) long-run average total cost curve.
B) short-run average fixed cost curve.
C) short-run marginal cost curve.
D) long-run marginal cost curve.

Question

Quizplus · Accepted Answer

The long-run average total cost curve represents the minimum average cost of producing various levels of output, as all variables of production can be adjusted to achieve optimal efficiency. The short-run curves only take into account fixed or variable costs, and are not able to capture the full picture of long-run efficiency. Additionally, the long-run marginal cost curve only shows the additional cost of producing one more unit of output, and does not reflect the overall average cost.

The Minimum Average Cost of Producing Alternate Levels of Output,allowing