1. FILL THE BLANKS ( 15 MARKS) 2. Achieved when firm is producing a given output at the lowest possible total cost is know as the theory of 3. Maximum amount of output that can be produced from any specified set of inputs, given existing technology is know as the theory of 4. An input for which the level of usage cannot readily be changed and which must be paid even if no output is produced is know as 5. All changes in output achieved by changing usage of variable inputs is know as the the basic concepts of production 6. ATC is U-shaped in which the SMC is equal at 7. AVC is U-shaped in which the SMC is equal 8. SMC is U-shaped when intersected at minimum point 9. Lies below AVC & ATC when 10. When marginal product (average product) is increasing. marginal cost (average cost) is 11. When marginal product (average product) is marginal cost (average variable cost) is increasing 12. An is a curve showing all possible input combinations capable of producing a given level of output 13. The is the slope of an isoquant & measures the rate at which the two inputs can be substituted for one another while maintaining a constant level of output 14. Increasing returns to scale if output goes up proportionately more than the increase in input usage 15. LMC intersects when the latter is at its minimum point 2. Write definition and the formula for ( 2X = 10 Marks) 1. AVC 2. AFC 3. ATC 4. SMC 5. LMC