For the short-run cost function AVC = a + bQ + cQ², A) the AVC curve is $\cup$ -shaped when a 0, and c 0, b 0. C) the corresponding SMC function is $S M C = a Q + 2 b Q ^ { 2 } + 3 c Q ^ { 3 }$ . D) both a and c E) all of the above

Question

For the short-run cost function AVC = a + bQ + cQ², A) the AVC curve is $\cup$ -shaped when a < 0, b > 0, and c < 0. B) the AVC curve is $\cup$ -shaped when a > 0, b < 0, and c > 0. C) the corresponding SMC function is $S M C = a Q + 2 b Q ^ { 2 } + 3 c Q ^ { 3 }$ . D) both a and c E) all of the above

Quizplus · Accepted Answer

The AVC curve is $\cup$-shaped when the coefficient of the quadratic term (c) is positive, indicating that the curve initially decreases and then increases.

For the Short-Run Cost Function AVC = a + BQ ∪\cup∪

For the Short-Run Cost Function AVC = a + BQ $\cup$