Average fixed cost
A)increases as output increases.
B)decreases as output increases.
C)increases if marginal cost is increasing.
D)increases if marginal cost is greater than average fixed cost.

Question

Quizplus · Accepted Answer

Average fixed cost is the fixed cost per unit of output. Since fixed cost is constant, as output increases, it is spread over a greater number of units, leading to a decrease in average fixed cost.

Average Fixed Cost