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WAEC Economics 2025 Question 38

Question 38

Theory of Costs and Revenue

Use Figure 2 (a firm's cost curves X, Y and Z with AR = MR at price P) to answer the question. The curve labelled Z is

Diagram for this question
  1. A.marginal cost curve.
  2. B.average cost curve.
  3. C.average fixed cost curve.
  4. D.average variable cost curve.
Show the answer and explanation

Answer: D (average variable cost curve.)

Explanation

Z is the lower U-shaped curve below the average cost curve Y: average variable cost.