Question

Q5. State giving reasons whether the following statement are true or false: (4)
a) With increase in the level of output, average fixed cost goes on falling till it reaches
zero
b) The difference between total cost and total variable cost falls with increase in output.​

Answer 1

Answer:

Name the chapter and class

Answer 2

Answer:

a) False

b) False

Explanation:

a)AfC = TFC/Output. TFC is constant and positive. So with an increase in output AFC will fall but can never he zero.

b) because the difference between Total Cost and Total Variable Cost is equal to Total Fixed Cost which remains constant at all levels of

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