If marginal cost increases when output increases, then
A) average total cost must decrease when output increases.
B) total cost is constant.
C) average variable cost must increase when output increases.
D) average fixed cost is constant.
E) marginal product must decrease when output increases.

Question

Quizplus · Accepted Answer

When marginal cost increases with output, it typically indicates diminishing marginal returns, meaning the marginal product of an input is decreasing.

If Marginal Cost Increases When Output Increases, Then