Choose the correct options with reference to short-run average costs.

(A) Average total cost = total cost / quantity of output

(B) Average total cost = average variable cost + average fixed cost

(C) Average variable cost = average total cost - average fixed cost

(D) Average fixed cost = average variable cost - average cost

Choose the correct answer from the options given below:

(A) Average total cost = total cost / quantity of output -> This is the fundamental definition of ATC, calculated by dividing total cost by output quantity. -> Correct statement.

(B) Average total cost = average variable cost + average fixed cost -> This relationship shows ATC is composed of AVC and AFC components. -> Correct statement.

(C) Average variable cost = average total cost - average fixed cost -> This is algebraically derived from statement (B) by rearranging: AVC = ATC - AFC. -> Correct statement.

(D) Average fixed cost = average variable cost - average cost -> This is incorrect. The correct formula is AFC = ATC - AVC, not AFC = AVC - ATC. -> Incorrect statement.

Hence, Option 2: (A), (B) and (C) only -> Statements (A), (B), and (C) correctly describe the relationships between different average cost measures in the short run. Statement (A) defines ATC, statement (B) shows the additive relationship, and statement (C) is a valid algebraic rearrangement. Statement (D) is mathematically incorrect as it reverses the subtraction order. The correct relationship for AFC should be AFC = ATC - AVC, not AVC - ATC. -> correct