The marginal cost curve intersects the average total cost (ATC)curve _____
A)at the ATC curve's minimum point.
B)only when the ATC curve is sloping upward.
C)at the ATC curve's maximum point.
D)only when the ATC curve is sloping downward.
E)when the ATC curve intersects the fixed cost curve.

Question

Quizplus · Accepted Answer

The marginal cost curve intersects the average total cost (ATC) curve at the ATC curve's minimum point. This is because the ATC curve is the average cost per unit of output, which includes fixed costs and variable costs. At the minimum point of the ATC curve, the marginal cost (which is the additional cost of producing one more unit of output) is equal to the average cost per unit of output (ATC). Therefore, the intersection of the marginal cost curve with the ATC curve must occur at the minimum point of the ATC curve.

The Marginal Cost Curve Intersects the Average Total Cost (ATC)curve