Asked by
henry fajilan
on Dec 11, 2024
Verified
Which of the following must be true if average variable costs are decreasing?
A) Average fixed cost exceeds average total cost.
B) Marginal cost exceeds average variable cost.
C) Marginal cost is less than average variable cost.
D) Marginal cost is less than average total cost.
Marginal Cost
The cost added by producing one additional unit of a product or service, important for decision-making in resource allocation.
Average Total Cost
The total cost of production divided by the quantity of output produced; it includes all fixed and variable costs.
- Scrutinize how shifts in output levels affect marginal and average costs, and their corresponding relationships.
Verified Answer
BJ
Learning Objectives
- Scrutinize how shifts in output levels affect marginal and average costs, and their corresponding relationships.