The average fixed cost curve always has a negative slope because: ...

[a0266361136]

The average fixed cost curve always has a negative slope because:
 a. marginal costs are below average fixed costs.
  b. average variable costs exceed marginal costs.
  c. total fixed costs always decrease.
  d. total fixed costs do not change as output increases.

Question 2

In deciding whether to invest in excess capacity in order to deter entry, incumbents should consider all of the following except
 a. the order of play in pricing and capacity choice decisions
  b. the customer sorting pattern
  c. the sunk cost required to achieve excess capacity
  d. the joint-profit-maximizing cartel output
  e. the potential entrant's projected profitability

[livaneabi]

Answer to Question 1

d

Answer to Question 2

d