5 Questions
Which one of the following is a key difference between accounting cost and economic cost?
Accounting cost includes only explicit costs, while economic cost includes both explicit and implicit costs.
Which one of the following best describes the concept of opportunity cost?
The cost of using resources in the production of a particular good or service, measured in terms of the next best alternative foregone.
Which one of the following is true about average fixed cost (AFC) and average variable cost (AVC)?
AFC remains constant as output increases, while AVC decreases.
Which one of the following best describes the relationship between marginal cost (MC) and average cost (AC)?
When MC = AC, AC is at its minimum.
Which one of the following best describes the concept of marginal revenue (MR)?
The revenue generated from selling one additional unit of output.
Test your knowledge on cost concepts, production functions, and cost of production in the short run with this quiz. Explore topics such as accounting cost vs economic cost, money cost vs real cost, fixed cost vs variable cost, opportunity cost, and more. Challenge yourself and enhance your understanding of these important economic principles.
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