If Marginal Cost Is Increasing, Average Variable Cost Must Also

question 101

True/False

If marginal cost is increasing, average variable cost must also be increasing.

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Definitions:

Price Variance

The difference between the expected price and the actual price paid for an item.

Factory Overhead Volume Variance

The difference between the budgeted and actual overhead costs due to variations in the volume of production.

Direct Labor Rate Variance

The difference between the actual cost of direct labor and the expected (or standard) cost, based on the hours actually worked.

Time Variances

The difference between actual time taken to perform an activity and the standard time expected.