When average variable cost is at its minimum, it is equal to the marginal cost of production at that level of output.

Question

Quizplus · Accepted Answer

This statement is true according to the law of diminishing returns, which indicates that when AVC is at its minimum, MC is equal to AVC. This is because any additional unit of production will have a cost equal to the marginal cost, which is equal to the AVC at that level of output.

When Average Variable Cost Is at Its Minimum, It Is