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The Market for Sweet Potatoes Consists of 1,000 Identical Firms STC=100+100q+100q2S T C = 100 + 100 q + 100 q ^ { 2 }

Question 62

Multiple Choice

The market for sweet potatoes consists of 1,000 identical firms. Each firm has a short-run total cost curve of STC=100+100q+100q2S T C = 100 + 100 q + 100 q ^ { 2 } , and a short-run marginal cost curve of SMC=100+200qS M C = 100 + 200 q , where qq is output. Suppose that sunk costs are 75 and nonsunk costs are 25 . What is the equation of an individual firm's average nonsunk cost curve?


A) ANSC=100+100qA N S C = 100 + 100 q
B) ANSC=100+100q+25/qA N S C = 100 + 100 q + 25 / q
C) ANSC=25/qA N S C = 25 / q
D) ANSC=100+200q+25/qA N S C = 100 + 200 q + 25 / q

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