If the Average Variable Cost Curve Is Above the Marginal

question 342

Multiple Choice

If the average variable cost curve is above the marginal cost curve, then

• A) marginal costs must be decreasing.
• B) average variable costs must be increasing.
• C) marginal costs must be increasing.
• D) marginal costs can be either increasing or decreasing.

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Definitions:

Time Lags

The delay between the initiation of a process or an action and its effect or result.

Real GDP

The total value of all goods and services produced over a specific time period, adjusted for inflation, reflecting the true growth of an economy.

Unemployed Workers

Individuals who are capable of working and willing to work but are unable to find suitable employment.

Discretionary Fiscal Policy

Government policy actions, such as changes in taxes and spending, aimed at stabilizing the economy that are initiated at the discretion of the government.