If Roberts Electronics finds that the average total cost of its radar detectors and the marginal cost of its radar detectors are both $85, then its:
A) marginal costs are falling.
B) average total cost is at its maximum.
C) average total costs are rising.
D) demand is elastic.
E) average total cost is at its lowest point.

Question

Quizplus · Accepted Answer

When the average total cost equals the marginal cost, the average total cost is at its lowest point. This is because marginal cost intersects average total cost at the minimum point of the average total cost curve.

If Roberts Electronics Finds That the Average Total Cost of Its