Cogts Picture 1Cost Y Cost Z Cost X 4 Based on Pic 1ltrue A

Cogts Picture 1Cost Y Cost Z Cost X 4. Based on Pic. 1ltrue: A. Cost Y Cost Z + Cost X B. Cost Z = Cost Y + Cost X C. Cost X-Cost Z-Cost Y D. Cost Y + Cost Z + Cost X = Total Cost 5. Based on Pic.1, the following is true A. Costs Y and Z are constant as output increases B. Cost X is increasing as output increases C. As output increases, Costs Y and Z initially increase at a decreasing rate, then increase at an increasing rate. D. As output increases, Costs Y and Z initially decrease, then increase.

Solution

a) Cost X is the fixed cost and Cost Z is the variable cost. Cost Y is the sum total of the two costs combined i.e. total cost of the production. The answer is \"A\".

b) The answer is \"C\", As the output increases, cost Y and Z increases at a decreasing rate, then increase at an increasing rate. Initially, the cost increased slowly with proportionate to the level of production. After a point, the firm is witnessing an increasing cost with little increase in the production.