Asked by
Samarah Foster
on Oct 14, 2024
Verified
If the average cost curve is U-shaped, then the marginal cost curve must cross the average cost curve at the bottom of the U.
Average Cost Curve
A graph that illustrates the cost per unit of output by dividing the total cost by the quantity of output produced, typically showing how costs fluctuate with changes in scale.
Marginal Cost Curve
A graph that shows the increase in cost incurred by producing one more unit of a good or service.
U-Shaped
Characterizes graphs or functions that have a visible dip in the middle, creating a shape similar to the letter "U," often found in economic analyses representing cost curves.
- Become familiar with the relationship between marginal, average, and total costs across distinct production conditions.
- Decode the relationship between the architecture of cost curves and enterprise decisions for both the short-term and long-term periods.
Verified Answer
GO
Learning Objectives
- Become familiar with the relationship between marginal, average, and total costs across distinct production conditions.
- Decode the relationship between the architecture of cost curves and enterprise decisions for both the short-term and long-term periods.