Total Costs in the Short Run

Q.

The numbers of units produced by a firm and the corresponding costs are tabulated below.

$\begin{array}{cc}No.ofunits& Totalcost\\ 100& Rs2000\\ 250& Rs3500\end{array}$

Assuming constant variable cost per unit, calculate the AFC for 100 units.

1. Rs 10

2. Rs 20

3. Rs 100

4. Rs 1000

Q.

At any level of output, the vertical distance between the TC curve and the TVC curve gives the

1. TFC

2. AVC

3. AFC

4. SAC

Q.

The slope of the TFC curve is equal to

1. 0

2. 1

3. -1

4. AFC

Q. ___is the total expenditure incurred by a firm on production of a commodity.

1. Total cost
2. Total variable cost
3. Total fixed cost
4. None of the above

Q.

Which of the following statements is correct?

1. If we add total variable cost and total fixed cost we get the average cost

2. Marginal cost is the result of total cost divided by number of units produced

3. Fixed costs vary with change in output

4. Total cost is obtained by adding up the total fixed cost and the total variable cost

Q.

Identify the correct choices.

1. Spreading effect dominates at lower levels of output

2. Diminishing returns dominates at lower levels of output

3. Spreading effect dominates at higher levels of output

4. Diminishing returns effect dominates at higher levels of output.

Q. ___is also known as Supplementary Cost or Overhead Cost.

Q. Salaries paid to permanent staff is an example of

1. Variable cost
2. Fixed cost
3. Marginal cost
4. None

Q. Fixed costs is the part of total cost which do not vary with ___

Q.

The difference between average total cost and average variable cost:

1. is constant

2. is the total fixed cost

3. increases as the output decreases

4. Is the average fixed cost