Question 13
MediumOriginal questionIf TFC rises (say the rent goes up) and nothing else changes, which curves move?
Show the answer and explanation
CorrectNot quiteAnswer D
Correct answer: D
Explanation
A higher fixed cost raises every total or average that includes it: TFC, TC, AFC and AC.
TVC, AVC and MC contain no fixed cost, so they stay where they are.
- Concept
- Effect of a rise in fixed cost
- Typical timeTypical
- 70 s
- Your timeYours
- —
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