A firm has determined, from past experience, that the learning curve for a new electronic component has a log-linear form with a slope coefficient of –0.10. What is the predicted short-run average variable cost after 10,000 units of a new product have been produced? The beginning short-run average total cost of the product is expected to be $1,000.
A. $398
B. $1,000,000
C. $10,000,000
D. None of the above is correct.