19 The reason the marginal cost curve eventually increases as output increases for the typical firm is because of Multiple Choice O O O diseconomies of scale. diminishing marginal utility. diminishing marginal returns. Increasing opportunity cost 20 When marginal cost is increasing, Multiple Choice total cost must be increasing. average total cost must be increasing. average total cost must be decreasing. average fixed cost might be increasing or decreasing. 21 If marginal cost is below average variable cost, Multiple Choice O O average total cost is increasing but average variable cost is decreasing. both average total cost and average variable cost are decreasing both average total cost and average variable cost are increasing. average variable cost is less than average fixed cost. 22 Which statement is correct? Multiple Choice Marginal cost is the change in average cost when there is a change in output of 1 unit The marginal cost curve cuts the average variable cost curve at its lowest point The marginal cost curve cuts the average variable cost curve at an output greater than where the marginal cost curve cuts the average cost curve. If average variable cost is increasing, then average total cost must be increasing too 23 Price B 03 w m Quantity Multiple Choice MC Refer to the provided graph. If the firm is producing at Q, the area BADE represents total costs. total variable costs. ATC AVC total fixed costs. average variable costs.