Once marginal costs rise above the average cost,
A)Average cost increases
B)Average cost decreases
C)Average costs will stay the same
D)None of the above

Question

Once marginal costs rise above the average cost,​
A)​Average cost increases
B)Average cost decreases
C)Average costs will stay the same
D)​None of the above

Quizplus · Accepted Answer

When marginal costs rise above the average cost, it means the cost of producing an additional unit is higher than the average cost of producing the previous units. This pulls the average cost upwards, causing it to increase.

Once Marginal Costs Rise Above the Average Cost,​

Once Marginal Costs Rise Above the Average Cost,