Uncertain effect on the level of average cost


Indicate whether each of the following involves an upward or downward shift in the long-run average cost curve or, instead, involves a leftward or rightward movement along a given curve. Also indicate whether each will have an increasing, decreasing, or uncertain effect on the level of average cost.

1. A rise in wage rates.

2. A decline in output.

3. An energy-saving technical change.

4. A fall in interest rates.

5. An increase in learning or experience.

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Finance Basics: Uncertain effect on the level of average cost
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