If marginal cost is increasing, then average variable cost must be increasing simultaneously.

Question

Quizplus · Accepted Answer

Marginal cost can increase while average variable cost is decreasing, increasing, or constant. This is because marginal cost is the cost of producing one more unit, while average variable cost is the total variable cost divided by the quantity produced. The relationship between them depends on the specific cost structure and production levels.

If Marginal Cost Is Increasing, Then Average Variable Cost Must