A firm's average costs will be falling whenever its marginal costs are:
A) positive.
B) negative.
C) less than average costs.
D) less than fixed costs.

Name: A firm's average costs will be falling whenever its marginal costs are: A) positive. B) negative. C) less than average costs. D) less than fixed costs.
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Question

Quizplus · Accepted Answer

When marginal costs are less than average costs, it means the cost of producing one more unit is less than the average, which will pull the average costs down, causing them to fall.

A Firm's Average Costs Will Be Falling Whenever Its Marginal