When average cost decreases as output increases, Group of answer choices marginal cost is below average cost average variable cost is rising average fixed cost is rising marginal cost is above average cost

When average cost decreases as output increases, Group of answer choices marginal cost is below average cost average variable cost is rising average fixed cost is rising marginal cost is above average cost

Survey Of Economics

10th Edition

ISBN:9781337111522

Author:Tucker, Irvin B.

Publisher:Tucker, Irvin B.

Chapter6: Proudction Costs

Section: Chapter Questions

Problem 9SQP

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Question

When average cost decreases as output increases,

Group of answer choices

marginal cost is below average cost

average variable cost is rising

average fixed cost is rising

marginal cost is above average cost

Definition Definition Measure of the cost of production per unit of output, including only variable costs such as wages, materials, and utilities. AVC is calculated by dividing total variable cost by the number of units produced. Understanding average variable cost is important for businesses to make decisions on pricing, production levels, and profitability.

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