Question

Study the diagram below, and answer the following questions.
('U'shaped line represents the AC curve)


At what level of output is the producer at equilibrium?

[1 mark]

• A. OP
• B. OB
• C. OQ
• D. O

Answer 1

The correct option is C OQ

Break even is attained when the AR = AC. Here, the level of output at which AR = AC is OQ.