Question

11.) In the long run, total fixed cost will:

a remain constant.

b increase.

c decrease.

d not exist by definition.

15.) Exhibit 7-12 Cost schedule for producing pizza

Pizzas	Fixed Cost	Variable Cost	Total Cost
0	$	$	$
1			48
2		17
3		27
4			78
5	40
6		64
7		80

By filling in the blanks in Exhibit 7-12, the AVC of 3 pizzas is shown to be equal to:

a $10.

b $13.33.

c $9.

d $22.33.

e $40.

16.) The short run is a period of time:

a in which a firm uses at least one fixed input.

b that is long enough to permit changes in the firm's plant size.

c in which production occurs within one year.

d in which production occurs within six months.

Answer 1

Q11
Answer
Option d
A short run is where some of the inputs should be fixed, and a long run all are variable. The long run is 1 hour for some business, and it is ten years, so it is different as per inputs required.
A short run is up to one of the input cannot be changed and long run when all inputs can be changed.

---------
Q12
AVC=VC/Q
=27/3
=$9
AVC of 3 units is $9

option c
-------
Q13
Option
a. in which a firm uses at least one fixed input
A short run is up to one of the input cannot be changed and long run when all inputs can be changed.