Which of the following statement/statements are true?
Statement 1: Vertical difference between AVC and SAC curve is AFC.
Statement 2: The TVC at a particular level of output is given by the area under the SMC curve up to that level
Statement 1: Vertical difference between AVC and SAC curve is AFC.
Statement 2: The TVC at a particular level of output is given by the area under the SMC curve up to that level
Answer & explanation
Correct answer: option 3
AFC is the difference between SAC and AVC. TVC at a level of output is sum total of all SMCs up to that level of output.