When the average total cost curve is rising,the marginal cost curve will be
A)Below the average fixed cost curve.
B)Falling with greater output.
C)Above the average total cost curve.
D)Below the average total cost curve.

Question

Quizplus · Accepted Answer

The average total cost is the sum of the average fixed cost and the average variable cost. When the average total cost curve is rising, it means that the average variable cost is increasing at a faster rate than the output, and the marginal cost curve is above the average total cost curve. This is because marginal cost measures the additional cost of producing one more unit of output, and if the average total cost is rising, it means that the cost of producing an additional unit is higher than the current average cost.

When the Average Total Cost Curve Is Rising,the Marginal Cost