If average variable cost is decreasing as output increases, then marginal cost is definitely
A) decreasing as output increases.
B) increasing as output increases.
C) less than average variable cost.
D) greater than average variable cost.

Question

Quizplus · Accepted Answer

When average variable cost is decreasing, marginal cost must be less than average variable cost to pull the average down.

If Average Variable Cost Is Decreasing as Output Increases, Then