-The graph above illustrates the total cost function for GoodieCookie Co. The changing slope of the total cost curve reflects this company's
A) decreasing average total costs.
B) decreasing marginal costs.
C) decreasing average variable costs.
D) decreasing fixed costs.

Question

-The graph above illustrates the total cost function for GoodieCookie Co. The changing slope of the total cost curve reflects this company's
A) decreasing average total costs. 
B) decreasing marginal costs. 
C) decreasing average variable costs. 
D) decreasing fixed costs.

Quizplus · Accepted Answer

A changing slope in the total cost curve typically indicates changes in marginal costs. If the slope is decreasing, it suggests that marginal costs are decreasing, meaning the cost of producing one more unit is getting lower as production increases. This is because the slope of the total cost curve represents the marginal cost at any given level of output. Fixed costs do not change with the level of output and thus do not affect the slope of the total cost curve. Average total costs and average variable costs are not directly related to the slope of the total cost curve in the same way that marginal costs are.

-The Graph Above Illustrates the Total Cost Function for GoodieCookie