GK
BUSINESS ECONOMICS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Marginal cost curve cuts the average cost curve from below at
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its lowest point
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the right of the lowest point
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the left of the lowest point
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all of the above
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Explanation:
Detailed explanation-1: -The marginal cost curve always intersects the average total cost curve at its lowest point because the marginal cost of making the next unit of output will always affect the average total cost. As a result, so long as marginal cost is less than average total cost, average total cost will fall.
Detailed explanation-2: -When the marginal costs curve is below an average curve the average curve is falling.
Detailed explanation-3: -Detailed Solution. Short-run marginal cost curve cuts the short run average cost curve from below at the minimum point of short run average cost.
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