If marginal cost exceeds average variable cost,
A)average variable cost is negative
B)average variable cost is increasing
C)marginal cost is greater than average total cost
D)average variable cost is decreasing
E)average fixed cost is increasing

Question

Quizplus · Accepted Answer

If the marginal cost exceeds average variable cost, it means that each additional unit is increasing the cost more than the average cost of producing the previous units. This implies that the average variable cost is increasing.

If Marginal Cost Exceeds Average Variable Cost