In a graph of a firm's short-run total costs and total revenue,the total cost and the total revenue curves,respectively,will intersect the vertical axis
A) above the origin, above the origin.
B) above the origin, at the origin.
C) at the origin, at the origin.
D) below the origin, below the origin.

Question

Quizplus · Accepted Answer

The total cost and total revenue curves intersect at the quantity where profit is maximized, which may be greater or less than zero, depending on the situation. However, both curves must pass through the origin because at zero output, there are no costs or revenues. Therefore, the correct answer is that both total cost and total revenue curves intersect at the origin. However, the choice that correctly reflects this is B, which states that total cost is above the origin and total revenue is at the origin.

In a Graph of a Firm's Short-Run Total Costs and Total