Which of the following is TRUE?
A) ATC = AVC - AFC
B) TVC/Q = TC/Q + TFC/Q
C) ΔTC/ΔQ = ΔAVC/ΔQ
D) ΔTC/ΔQ = MC

Question

Quizplus · Accepted Answer

This is the definition of marginal cost (MC), which is the change in total cost (ΔTC) associated with a one-unit change in quantity produced (ΔQ). Options A and C are incorrect as they relate to average total cost (ATC) and average variable cost (AVC) respectively. Option B is incorrect as it is a rearrangement of the equation for average variable cost (AVC = TVC/Q).

Which of the Following Is TRUE