Average fixed costs for a given level of output can be determined graphically by
A)summing the marginal costs of any number of units of output and dividing the sum by that output.
B)the vertical distance between TC and TVC.
C)the vertical distance between AVC and MC.
D)the vertical distance between ATC and AVC.

Question

Quizplus · Accepted Answer

Average Fixed Cost (AFC) is the fixed cost per unit of output. Graphically, it is represented by the vertical distance between the Average Total Cost (ATC) curve and the Average Variable Cost (AVC) curve. This is because ATC is the sum of AVC and AFC, so the difference between ATC and AVC at any level of output gives the AFC.

Average Fixed Costs for a Given Level of Output Can