Short-Run Average and Total Cost
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True or False? Please explain your reasoning.
a. The short-run average total cost can never be less than the long-run average total cost.
b. The short-run average variable cost can never be less than the long-run average total cost.
c. In the long run, choosing a higher level of fixed cost shifts the long-run average total cost curve upward.
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Solution Summary
The solution determines the short-run average and total cost.
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(1) the short-run average total cost can never be less than the long-run average total cost- T
This is because long-term unit costs usually are less than short-term unit costs b/c over a long period of time, companies can change their operations ...
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