In short-run, when average cost falls as a result of an increase in output, marginal cost is __________ average cost.

CA Foundation · Business Economics · PYQS · January 2025
In short-run, when average cost falls as a result of an increase in output, marginal cost is __________ average cost.
(A) A. greater than
(B) B. less than
(C) C. equal to
(D) D. independent of

Suggested Answer and Working Notes:

Correct Answer: Option (B)

B. less than

Topics: Theory of Production and Cost

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