If the short-run average cost curve for a firm is a decreasing function of its output over a certain range, then in that range we must have (A) the firm's marginal cost curve must also be decreasing (B) the marginal cost curve will lie below the average cost curve, assuming that output is plotted on the horizontal axis and the costs are on the vertical axis (C) the location of the marginal cost curve is uncertain since it depends on whether the firm is a competitive one or not (D) the marginal cost curve will lie above the average cost curve, assuming that output is plotted on the horizontal axis and the costs are on the vertical axis

JNU SSS 2018 Question 28: Costs of production

If the short-run average cost curve for a firm is a decreasing function of its output over a certain range, then in that range we must have

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Costs of production has come up 83 times in 7 exams since 2006.

This question is on Short-run cost curves and their relationships, part of Costs of production in Microeconomics.

Fixed, variable, average and marginal cost, and how marginal cost relates to average cost.

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