All of the following are U-shaped curves, except _____________.

AVC curve

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AFC curve

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AC curve

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MC curve

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Solution

The correct option is B AFC curve
All the cost curves are U-shaped except the average fixed cost curve. Fixed cost is constant, thus, with the every increase in output average fixed cost decreases. Thus it assumes the shape of hyperbola.

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Similar questions

Suppose that a firm's total fixed cost is Rs. 100, and the marginal cost schedule of a firm is the following :

$\begin{matrix} Output (in units) & 1 & 2 & 3 & 4 & 5 & 6 & 7 Marginal cost (in Rs) & 10 & 20 & 30 & 40 & 50 & 60 & 70 \end{matrix}$

(i) Is the MC curve U-shaped ?

(ii) Derive the AVC schedule. Will the AVC curve U-shaped ? Discuss.

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