Refer to Figure 21.3.The vertical difference between the total cost curve and the total fixed cost curve represents
A) Total variable costs.
B) Total marginal costs.
C) Average fixed costs.
D) Average variable costs.

Question

Refer to Figure 21.3.The vertical difference between the total cost curve and the total fixed cost curve represents
A) Total variable costs. 
B) Total marginal costs. 
C) Average fixed costs. 
D) Average variable costs.

Quizplus · Accepted Answer

The vertical difference between the total cost curve and the total fixed cost curve represents the total variable costs. This is because the total cost curve is the sum of the total fixed cost curve and the total variable cost curve. Therefore, the vertical difference between the two curves represents the total variable costs.