Figure 13-4 shows short-run cost and demand curves for a monopolistically competitive firm in the market for designer watches.
-Refer to Figure 13-4.What is the area that represents the total variable cost of production?
A)0P0aQa
B)0P1bQa
C)P0abP1
D)P1bdP3

Question

Figure 13-4 shows short-run cost and demand curves for a monopolistically competitive firm in the market for designer watches.
-Refer to Figure 13-4.What is the area that represents the total variable cost of production?
A)0P0aQa 
B)0P1bQa 
C)P0abP1 
D)P1bdP3

Quizplus · Accepted Answer

The total variable cost of production is represented by the area under the marginal cost curve up to the level of output produced, which in this case is 0P1bQa.

Figure 13-4 Shows Short-Run Cost and Demand Curves for a Monopolistically