Which of the following depicts the change in per-unit cost of production resulting from a decrease in the input prices,given the output produced by the firm is constant?
A)An upward shift of the marginal cost curve
B)A rightward shift of the total cost curve
C)A downward shift of the average cost curve
D)An upward shift of the isocost curve

Question

Quizplus · Accepted Answer

A decrease in input prices will lead to lower production costs, resulting in a downward shift of the average cost curve. This is because the same output can now be produced at a lower cost, leading to a lower average cost per unit. A rightward shift of the total cost curve or an upward shift of the marginal cost curve would occur if there was an increase in input prices or if the output produced by the firm increased. An upward shift of the isocost curve would occur if the cost of both inputs increased or if the firm decided to produce more output.

Which of the Following Depicts the Change in Per-Unit Cost