Managerial Economics

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When a firm increased its output by one unit, its Average Cost decreased. This implies that
A)the law of diminishing returns has not yet taken effect
B)MC<AFC
C)MC<AC
D)MC=AC

  • Managerial Economics -

    Do a little research, then take a shot. Hint: draw a picture; the MC must cut the AC curve a the minimum point of the AC curve.

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