Asked by Ranjani Ramaswamy on Jul 14, 2024
Verified
At the current level of output,Becca Furniture's marginal cost curve is above the average total cost curve.This means Becca Furniture's average total cost curve:
A) must be rising.
B) must be flat.
C) must be falling.
D) may be rising,falling,or flat depending on other things.
Marginal Cost Curve
A visual diagram that illustrates the variation in the cost to produce an additional unit of a product as the quantity produced changes.
Average Total Cost Curve
A curve that shows the average cost per unit of output at different levels of production; it typically has a U-shape.
- Study the association between curves of marginal cost and average cost.
Verified Answer
LT
Lacie TurpinJul 17, 2024
Final Answer :
A
Explanation :
If the marginal cost curve is above the average total cost curve, it means the additional cost of producing one more unit is higher than the average cost of producing all units. This would pull up the average cost curve and cause it to rise. Therefore, the best choice is A.
Learning Objectives
- Study the association between curves of marginal cost and average cost.