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Economics (AS & A Level) · Feb / March 2021 · Paper 32 · Question 6

9708Types of cost, revenue and profit, short-run and long-run production

In the diagram, TC is a firm's short-run total cost curve. Which statement is correct?

  1. AAverage total cost is minimised at output OQ3.
  2. BAverage variable cost is minimised at output OQ2.
  3. CAverage variable cost is minimised at output OQ3.
  4. DMarginal cost is minimised at output OQ1.

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Correct answer: A. Average total cost is minimised at output OQ3.

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