Post Utme Christopher University 2022 Commerce Question 40

Practice objective / multiple choice question 40 from the 2022 Post Utme Christopher University Commerce examination.

Post Utme Christopher University 2022 Commerce Objective / Multiple Choice
Question 40 POST_UTME_CHRISTOPHER_UNIVERSITY • 2022 • COMMERCE • objective

A firm's average total cost (ATC) is the total cost divided by the quantity produced. Explain why the ATC curve is downward sloping in the case of a perfectly competitive market.

Answer Options

A. Because the ATC curve is downward sloping due to the law of increasing opportunity cost.
Correct Answer B. Because the ATC curve is downward sloping due to the law of diminishing returns.
C. Because the ATC curve is downward sloping due to the firm's inability to influence the market price.
D. Because the ATC curve is downward sloping due to the firm's inability to influence the market quantity.
Correct Answer
B
Correct Option:
Because the ATC curve is downward sloping due to the law of diminishing returns.

About This Question

This is Post Utme Christopher University 2022 Commerce Question 40. It is one of the objective questions from the 2022 Post Utme Christopher University Commerce examination.

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