In terms of the relation between the average cost (AC) and marginal cost (MC) curves: When average cost is decreasing in quantity for a competitive firm, which of the following must be true? AC < MC O AC > MC O AC - MC

In terms of the relation between the average cost (AC) and marginal cost (MC) curves: When average cost is decreasing in quantity for a competitive firm, which of the following must be true? AC < MC O AC > MC O AC - MC

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

In terms of the relation between the average cost (AC) and marginal cost (MC)
curves: When average cost is decreasing in quantity for a competitive firm, which of
the following must be true?
AC < MC
O AC > MC
O AC=MC

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