If average cost is decreasing,
A)marginal cost equals average cost.
B)marginal cost exceeds average cost.
C)marginal cost is less than average cost.
D)Not enough information is provided.

Question

Quizplus · Accepted Answer

When average cost is decreasing, it means that the cost of producing each additional unit is becoming lower. This implies that the marginal cost must be less than the average cost at this point.

If Average Cost Is Decreasing