Asked by Mitchel Rozwadowski on Apr 29, 2024
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In the short run,if marginal cost is higher than average total cost,producing an extra unit of output must raise average total cost.
Marginal Cost
The heightened expense incurred by fabricating an extra unit of a product or service.
Average Total Cost
The overall expense of manufacturing, including both fixed and variable costs, divided by the amount of product made.
Extra Unit
Refers to an additional quantity of a good or service, often used in the context of calculating marginal costs or benefits.
- Interpret the link between average total cost curve, average variable cost curve, and fixed expenses.
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Learning Objectives
- Interpret the link between average total cost curve, average variable cost curve, and fixed expenses.
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