If marginal cost isA) falling, then average total cost must also be falling.B) rising, then average total cost must also be rising.C) rising, then average total cost could be either falling or rising.D) falling, then average total cost could be either falling or rising.

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Angelia Rizzi · Accepted Answer

Final Answer : C, Explanation :  Marginal cost affects average total cost depending on its relation to the current average. If marginal cost is rising but still below average total cost, it can pull the average down, or if it's above, it can push the average up.

If marginal cost is

A) falling, then average total cost must also be falling.
B) rising, then average total cost must also be rising.
C) rising, then average total cost could be either falling or rising.
D) falling, then average total cost could be either falling or rising.

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