Multiple choice

If AC is minimum

  1. MC > AC

  2. MC > AC

  3. MC = AC

  4. none of these

Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

When average cost is at its minimum point, marginal cost equals average cost. This is the mathematical relationship: MC intersects AC from below at AC's minimum. Before the minimum, MC < AC (pulling average down). After the minimum, MC > AC (pulling average up). At the minimum itself, MC = AC.

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