Marginal Cost Mock 2 Q8

Discussion in 'CB2' started by Eitan, Apr 10, 2023.

  1. Eitan

    Eitan Made first post

    Hi all,

    Just struggling with this question:

    if marginal cost is the amount by which total cost will rise when the NEXT unit is produced, then option D makes sense—
    when average variable cost is at a minimum, then that means that an additional unit produced will raise total variable cost, which means the additional unit will have an higher-than-minimum cost i.e. marginal cost is higher than the minimum average variable cost.

    And yet the solution says that Marginal cost will equal the average variable cost when the latter is at a minimum...

    Please help with this, thanks so much!
     

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