On a graph, which of the following curve cost starts from Zero?
Answer & explanation
Correct answer: option 1
The correct answer is option 1: TVC curve
TVC (Total Variable Cost) starts from zero.
- At zero output, TVC = 0 because variable costs depend on production.
- As output increases, TVC increases, forming an upward-sloping curve.
Why not other options?
2️⃣ AFC Curve (Option 2):
- AFC = TFC / Q
- Since TFC is positive, AFC is not defined at Q = 0 and does not start from zero.
- AFC curve is, in fact, a rectangular hyperbola.
3️⃣ TFC Curve (Option 3):
- TFC remains constant regardless of output.
- Even at Q = 0, TFC has a positive value, meaning it starts above zero.
