Consider a firm with fixed costs of production (F). Which FOUR of the following statements are correct?

Question

Answer

At Q=0, average cost is equal to fixed costs.

Answer

The MC curve cannot be horizontal.

Answer

If AC has a minimum , then AC = MC at that point

Answer

When AC > MC, the AC curve is
downward-sloping.

Answer

When AC > MC, the MC curve is
downward-sloping.

Answer

As Q becomes very small, AC becomes very large

Answer

As Q becomes very large, AC becomes very small

Answer

At Q=1, average costs and total costs are equal

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