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A recent health craze in Brisbane has seen an increase in the popularity of volleyball. The market for volleyball equipment (i.e balls, nets, shirts) is
A recent health craze in Brisbane has seen an increase in the popularity of volleyball. The market for volleyball equipment (i.e balls, nets, shirts) is perfectly competitive. Greg decides to open a single volleyball equipment shop called Volleyball Vacation. He will incur fixed costs for store rent and variable costs include operating the machinery (for making the equipment), raw materials, and wages for employees. Assume that Greg's marginal cost increases with the total quantity of volleyball equipment produced and are initially less than his average variable costs. As the quantity of volleyball equipment Greg produces in his store increases, which of the following statements are true: [3 Greg's average variable costs will always remain constant. [3 Greg's average variable cost will always increase at a constant rate. [3 Greg's average variable cost will initially be high, then will continually decrease. [j Greg's average variable cost would initially decrease at low levels of production, but will begin to increase after a certain point
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