Explain the relationship between average total cost curve, average variable cost curve and marginal cost diagram.

Explain the relationship between average total cost curve, average var

1.	Explain the relationship between average total cost curve, average variable cost curve and marginal cost diagram.
Answer» Solution :The average total cost curve is typically U-shaped. ... MARGINAL cost (MC) is calculated by taking the change in total cost between two LEVELS of output and dividing by the change in output. The marginal cost curve is upward-sloping. Average VARIABLE cost obtained when variable cost is DIVIDED by quantity of output.