The diagram above represents the total production cost of a car manufacturer.Which of the following statements correctly describes the cost of
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The diagram above represents the total production cost of a car manufacturer. Which of the following statements

correctly describes the cost of production?

q9_1.png

Select one:

a. The marginal cost increases as total output increases.

b. The average cost increases and then decreases as total output increases.

c. The average cost when producing 60 cars is $240,000.

d. The total production cost when producing 20 cars is $80,000 less the fixed costs.

e. The average cost is constant and is $4,000.

q9_1.png

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