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Production and cost — Economics STD 12 Humanities & Commerce — Question

Rajasthan BoardEnglish MediumSTD 12 Humanities & CommerceEconomicsProduction and cost2 Marks
Question
What is the behaviour of Average Fixed Cost as output is increased? Why is it so?
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Answer

AFC falls, when output is increased. Since, the Total Fixed Cost remains the same with changes in output, therefore, AFC falls steadily with increase in output. AFC curve is downward sloping.

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