When a fine caterer produces 30 catered meals, its marginal cost and average variable cost each equal $10.Therefore, assuming normally shaped cost curves, at 29 meals:
A)its marginal cost is greater than $10 and its average variable cost is less than $10.
B)its marginal cost is less than $10 and its average variable cost is more than $10.
C)its marginal cost and its average variable cost are each greater than $10.
D)its marginal cost and its average variable cost are each equal to $10.

Question

Quizplus · Accepted Answer

When marginal cost equals average variable cost, the average variable cost is at its minimum. At 29 meals, marginal cost is less than $10, and average variable cost is more than $10.

When a Fine Caterer Produces 30 Catered Meals, Its Marginal