Answer to Question #42952 in Economics for Zakaria

Question

Till the average cost curve falls the marginal cost curve is :
a. Equal to average cost
b. Grater than the average cost
c. Less than average cost
d. Equal to total cost
e. Is not related to the average cost

Answer 1

Till the average cost curve falls the marginal cost curve is less thanaverage cost. Marginal cost is lower than average cost, while average cost decreases, and average cost starts increasing after the point, where average cost equals marginal cost.

So, the right answer is c).