Asked by
Cambree Anderson
on Oct 27, 2024
Verified
The larger the output,the more output over which fixed cost is distributed.Called the _____ effect,this leads to a _____ average _____ cost as output rises.
A) spreading;lower;fixed
B) spreading;higher;fixed
C) diminishing returns;lower;variable
D) diminishing returns;higher;variable
Spreading Effect
The financial strategy of distributing investments across various assets to reduce risk and potentially increase returns.
Fixed Cost
Costs that do not vary with the level of output or activity.
Output
The aggregate production of either goods or services by an organization, commercial sector, or the economy as a whole.
- Gain insight into the differentiation of variable, fixed, and total expenditures in production.
- Examine how varying production volumes impact average total costs, variable costs, and fixed costs.
Verified Answer
SK
Learning Objectives
- Gain insight into the differentiation of variable, fixed, and total expenditures in production.
- Examine how varying production volumes impact average total costs, variable costs, and fixed costs.