1.The short-run marginal cost curve is shaped like the letter _________ and the short-run average cost curve is shaped like the letter _________.
2.The negatively sloped portion of the short-run marginal-cost curve is explained by _________ and the positively sloped portion is explained by _________.
3.Over the positively sloped portion of the short-run average-cost curve, the effect of
dominates the effect of
.
4. At the current level of output, the marginal cost of MP3 players exceeds the average cost. If you increase output, the average cost will
(increase/decrease).
5. If marginal cost equals average cost, we are at the minimum point of the
cost curve.
6. Arrows up or down. When marginal cost is less than average cost, an increase in output
average cost. When marginal cost exceeds average cost, an increase in output average cost.
7.The short-run average cost of production is the same for two different quantities.
(True/False)