Which of the following statements is NOT correct? The long-run total cost curve is the lower envelope of all the short-run total ost curves. O The marginal cost curve intersects average variable cost (AVC) and average total cost (ATC) at the minimum of ATC and AVC. The long-run average total cost curve must be the lower envelope of all of the firm's short-run average total cost curves. O In the short run where capital is fixed, to minimize the cost, the necessary condition is the technical rate of substitution equals to input price ratio.
Which of the following statements is NOT correct? The long-run total cost curve is the lower envelope of all the short-run total ost curves. O The marginal cost curve intersects average variable cost (AVC) and average total cost (ATC) at the minimum of ATC and AVC. The long-run average total cost curve must be the lower envelope of all of the firm's short-run average total cost curves. O In the short run where capital is fixed, to minimize the cost, the necessary condition is the technical rate of substitution equals to input price ratio.
Chapter10: Cost Functions
Section: Chapter Questions
Problem 10.4P
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Transcribed Image Text:Which of the following statements is NOT correct?
The long-run total cost curve is the lower envelope of all the short-run total ost
curves.
O The marginal cost curve intersects average variable cost (AVC) and average total
cost (ATC) at the minimum of ATC and AVC.
The long-run average total cost curve must be the lower envelope of all of the
firm's short-run average total cost curves.
O In the short run where capital is fixed, to minimize the cost, the necessary
condition is the technical rate of substitution equals to input price ratio.
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