passwella.
Menu

JAMB Economics 2007 Question 19

Question 19

Theory of Costs and Revenue

If the total fixed cost is the same regardless of output, the average fixed cost will be

  1. A.increasing
  2. B.maximum
  3. C.minimum
  4. D.decreasing
Show the answer and explanation

Answer: D (decreasing)

Explanation

Average fixed cost = fixed cost ÷ output; the same fixed cost spread over more units gets smaller.