When MC is rising,ATC

Question

Quizplus · Accepted Answer

When the marginal cost (MC) is rising, it may cause the average total cost (ATC) to either rise or fall, depending on the degree to which the marginal cost is increasing. If the marginal cost is rising at a higher rate than the average total cost, then the average total cost will rise. Conversely, if the marginal cost is rising at a slower rate than the average total cost, then the average total cost may fall. Therefore, the correct answer is C - may be falling or rising.

When MC Is Rising,ATC