Which of the following costs exhibits both decreasing and increasing marginal costs over a speciﬁc range of activity?
A)Semivariable cost.
B)Curvilinear cost.
C)Step-ﬁxed cost.
D)Step-variable cost.
E)Fixed cost.

Question

Quizplus · Accepted Answer

Curvilinear cost exhibits both decreasing and increasing marginal costs over a specific range of activity. At low levels of activity, the marginal cost decreases due to economies of scale. However, beyond a certain level of activity, the marginal cost starts increasing due to the law of diminishing returns.

Which of the Following Costs Exhibits Both Decreasing and Increasing