wiz-icon
MyQuestionIcon
MyQuestionIcon
1
You visited us 1 times! Enjoying our articles? Unlock Full Access!
Question

Marginal cost can be equal to average variable cost when _________.

A
average variable cost is falling
No worries! We‘ve got your back. Try BYJU‘S free classes today!
B
average variable cost is increasing
No worries! We‘ve got your back. Try BYJU‘S free classes today!
C
average variable cost is minimum
Right on! Give the BNAT exam to get a 100% scholarship for BYJUS courses
D
under any of the above situations
No worries! We‘ve got your back. Try BYJU‘S free classes today!
Open in App
Solution

The correct option is B average variable cost is minimum
When the MC curve is lower than the AC curve, ie the MC AC the average cost will tend to fall as if you take a lower number and add it to the average and then take a new average, the new average has to be lower. At some point the MC will stop falling and begin rising to a point where it will meet the AC curve. Thus only when the MC AC will the AC curve begin to rise as now a higher number is being added, and the new average must be higher. Thus the point that the MC meets the AC curve, has to be its minimum point.

flag
Suggest Corrections
thumbs-up
0
Join BYJU'S Learning Program
similar_icon
Related Videos
thumbnail
lock
Central Tendency
MATHEMATICS
Watch in App
Join BYJU'S Learning Program
CrossIcon