If Marginal Cost Is LESS Than Average Total Cost,then _____

question 266

Multiple Choice

If marginal cost is LESS than average total cost,then _____ cost is _____.

• A)average total;increasing
• B)average total;decreasing
• C)marginal;necessarily increasing
• D)marginal;necessarily decreasing

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Definitions:

Opportunity Cost

The cost of forgoing the next best alternative when making a decision; it represents the benefits missed when choosing one option over another.

Consumer Goods

Items bought by the typical consumer for personal use.

Opportunity Cost

The cost of foregoing the next best alternative when making a decision or choosing to allocate resources in a certain way.

Linear Production

A production process where there is a constant ratio of inputs to outputs, typically represented by a straight line in graphical analysis.