If Marginal Cost Is Less Than Average Variable Cost and Output

question 134

Multiple Choice

If marginal cost is less than average variable cost and output increases, average total cost ________ and average variable cost ________.

• A) increases; increases
• B) decreases; decreases
• C) decreases; increases
• D) increases; decreases

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Definitions:

Rational

Based on logic or reason; capable of coherent thought processes leading to sound decisions or judgments.

Continuum

A continuous sequence in which adjacent elements are not perceivably different from each other, though the extremes are quite distinct.

Intense Relationships

Relationships characterized by strong emotions, extreme closeness or dependency, and often turbulent interactions.

Idealizes

Involves viewing someone or something as perfect or better than in reality, often ignoring flaws.