Answer to Question #225530 in Economics of Enterprise for Cebo

Question

1.1. Discuss the relationship between the three short-run total cost curves. Use a

diagram to motivate your answer

Answer 1

The 3 curves display that the total cost which is linked to short-run production tends to be total cost curve, total fixed cost curve as well as total variable cost curve. Ideally, the total fixed cost tends to be about $3 as it is never affected by the produced quantity of output, therefore Total fixed curve is a horizontal, flat line.