APFIVE Shifts in Short-Run Cost Curves
A firm’s workers receive specialized training that increases their productivity by 15%. However, the firm must now pay 5% higher wages and spent $10,000 on the training program. In the short run, how will this affect the firm’s cost curves?
A
AVC shifts down, AFC shifts up, and ATC may shift either way
B
All cost curves shift upward due to higher wages
C
All cost curves shift downward due to higher productivity
D
Only MC shifts while other curves remain unchanged
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