If marginal cost is between average variable cost and average total cost, then
A) both average variable cost and average total cost are increasing.
B) both average variable cost and average total cost are decreasing.
C) average variable cost is increasing and average total cost is decreasing.
D) average variable cost is decreasing and average total cost is increasing.

Question

Quizplus · Accepted Answer

When marginal cost is between average variable cost and average total cost, average variable cost is increasing because marginal cost is above it, and average total cost is decreasing because marginal cost is below it.

If Marginal Cost Is Between Average Variable Cost and Average