For most firms, if the marginal cost curve is plotted on a graph, marginal cost will
A)increase then decrease.
B)decrease then increase.
C)remain constant.
D)decrease over the entire range of output.

Question

Quizplus · Accepted Answer

In most firms, as output increases, so do the costs associated with producing each additional unit. This leads to a decreasing marginal cost curve in the beginning. However, at some point, the costs of production may increase due to factors such as limited resources or inefficient production methods. This leads to an increasing marginal cost curve towards the end. Therefore, the marginal cost curve usually has a U-shape, with decreasing marginal cost initially and then increasing marginal cost later on.

For Most Firms, If the Marginal Cost Curve Is Plotted