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Consumer & Producer Surplus · Question 7 of 70

Question 7

MediumOriginal question

Read the two statements and choose the correct option.

I. Integrating the marginal cost gives the total cost up to a constant, and that constant is the fixed cost.

II. The fixed cost can be found from the marginal cost function alone.

Options for question 7

Show the answer and explanation
CorrectNot quiteAnswer A

Correct answer: A

Explanation

  1. I: C(x)=∫MC dx+kC(x) = \int MC\,dx + k, and C(0)=kC(0) = k is the fixed cost. True.

  2. II: differentiating removes the fixed cost, so MC alone cannot bring it back; one more fact, such as C(0)C(0) or the cost of some output, is needed. False.

Concept
What marginal cost can and cannot give
Typical time
90 s
Your time
—
The rule this testsTotal cost from marginal cost
Practise this chapter →

Ten questions from Consumer & Producer Surplus, at your own pace.

Practise this chapter →

Ten questions from Consumer & Producer Surplus, at your own pace.