The figure given below shows the demand and cost curves of a perfectly competitive firm.Figure: 10.4
D: Demand curve
MC: Marginal cost curve
ATC: Average-total cost curve
AVC: Average-variable-cost curve
-In the short run, certain costs, such as rent on land and equipment, must be paid whether or not any output is produced. These are:

Question

The figure given below shows the demand and cost curves of a perfectly competitive firm.Figure: 10.4
  D: Demand curve
MC: Marginal cost curve
ATC: Average-total cost curve
AVC: Average-variable-cost curve
-In the short run, certain costs, such as rent on land and equipment, must be paid whether or not any output is produced. These are:

Quizplus · Accepted Answer

Fixed costs are costs that must be paid in the short run regardless of how much output is produced. These costs are reflected in the Average-total cost (ATC) curve and the Average-variable-cost (AVC) curve, which are both U-shaped. Therefore, the correct choice is E, the firm's fixed costs.

The Figure Given Below Shows the Demand and Cost Curves