Question

Marginal cost Multiple Choice rises for a time but then begins to decline when diminishing returns set in. declines continuously as output increases. is the difference between total cost and total variable cost. equals both average variable cost and average total cost at their respective minimums.

Answer 1

Marginal cost equals both average variable cost and average total cost at their respective minimums.

Option: D

Explanation:

A reduction in the overall cost of output arising from the output or manufacture of one additional item, is understood as marginal production value. To measure marginal value divide the increase in cost of output by quantity adjustment. The aim of the marginal cost analysis is to evaluate the point at which an enterprise can obtain economy of scale in order to maximize output and total activities.

The marginal cost is equal to the marginal revenue. Fixed costs and variable costs compose of the manufacturing costs. With an increasing or decreasing in levels of production, fixed costs do not shift, and the same price can be distributed over other output units, with increased demand.