If the total cost of 100 units is $560 and the marginal cost of the 101st unit is $6
A) total cost will fall.
B) total fixed cost will rise.
C) total variable cost will fall.
D) average total cost will rise.
E) average variable cost will fall.

Question

Quizplus · Accepted Answer

Since the marginal cost of producing the 101st unit is $6, it is higher than the average cost of producing the first 100 units. This means that the new unit will lead to an increase in the average total cost of producing each unit, since the average cost will now include the $6 marginal cost. Therefore, the correct answer is that average total cost will rise (choice D).

If the Total Cost of 100 Units Is $560 and the Marginal