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.

Question

Quizplus · Accepted Answer

When average variable costs are decreasing, it means that the marginal cost is less than the average variable cost, as the addition of a unit of output is lowering the average.

Which of the Following Must Be True If Average Variable