1. Using the image below, explain why average total cost must be rising if marginal cost is above average total cost.

Transcribed Image Text:

Costs $3.00 2.50 2.00 150 1.50 100 1.00 0.50 MC ATC AVC AFC 2 4 6 8 10 12 14 Quantity of Output Costs $3.00 2.50 2.00 150 1.50 100 1.00 0.50 MC ATC AVC AFC 2 4 6 8 10 12 14 Quantity of Output

Answer rating: 100% (QA)

Answer When marginal cost MC is above average total cost ATC it means each additional unit of output ... View the full answer