Which of the following cost curves can never have a positive slope?
A)AFC
B)ATC
C)AVC
D)SMC

Question

Quizplus · Accepted Answer

AFC (average fixed cost) will always decrease as output increases, since fixed costs are spread over a larger level of output. Therefore, it can never have a positive slope.

ATC (average total cost) and AVC (average variable cost) can have a positive slope if marginal cost (SMC) is increasing at a faster rate than average cost.

SMC can also have a positive slope if additional units of output require increasingly more expensive resources to produce.

Which of the Following Cost Curves Can Never Have a Positive