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Author Question: The dynamic aggregate demand and aggregate supply model assumes that potential GDP increases over ... (Read 125 times)

EAugust

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on: Jun 29, 2018
The dynamic aggregate demand and aggregate supply model assumes that potential GDP increases over time.
 
  Indicate whether the statement is true or false

Question 2

If the fixed costs for a firm rise what will be the impact on the marginal cost, average variable cost and average total cost curves? Explain.
 
  What will be an ideal response?


samiel-sayed

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Reply #1 on: Jun 29, 2018
Answer to Question 1

TRUE

Answer to Question 2

There will be no impact on either the marginal cost or average variable cost curves. The average total cost curve will shift up since the average fixed costs will have rise as well.


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