[amp_mcq option1=”Average fixed cost curve” option2=”Average variable cost curve” option3=”Production potential curve” option4=”Extension path” correct=”option1″]<\/p>\n
The correct answer is: A. Average fixed cost curve<\/strong><\/p>\n An average fixed cost curve is a graph that shows the average amount of money a company spends on fixed costs per unit of output. Fixed costs are costs that do not change with the level of output, such as rent or insurance. As output increases, the average fixed cost decreases because the fixed cost is spread out over more units.<\/p>\n A rectangular hyperbola is a curve that has the equation $y = \\frac{k}{x}$, where $k$ is a constant. The graph of an average fixed cost curve is a rectangular hyperbola because the average fixed cost is constant at a given level of output, but the average fixed cost decreases as output increases.<\/p>\n The other options are incorrect because they are not represented by a rectangular hyperbola.<\/p>\n [amp_mcq option1=”Average fixed cost curve” option2=”Average variable cost curve” option3=”Production potential curve” option4=”Extension path” correct=”option1″]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12],"tags":[],"class_list":["post-50860","post","type-post","status-publish","format-standard","hentry","category-economics","no-featured-image-padding"],"yoast_head":"\n\n