Where does SMC curve cut AC? Give reasons to support your answer.

1.	Where does SMC curve cut AC? Give reasons to support your answer.
Answer» <html><body><p></p>Solution :SMC curve cut <a href="https://interviewquestions.tuteehub.com/tag/ac-361271" style="font-weight:bold;" target="_blank" title="Click to know more about AC">AC</a> at its minimum points.When the <a href="https://interviewquestions.tuteehub.com/tag/mc-1091384" style="font-weight:bold;" target="_blank" title="Click to know more about MC">MC</a> is smaller the AC, the AC decreases. This is because when the extra <a href="https://interviewquestions.tuteehub.com/tag/unit-1438166" style="font-weight:bold;" target="_blank" title="Click to know more about UNIT">UNIT</a> of output is cheaper than the <a href="https://interviewquestions.tuteehub.com/tag/average-13416" style="font-weight:bold;" target="_blank" title="Click to know more about AVERAGE">AVERAGE</a> cost then the AC is pulled down. Similarly, when the MC is <a href="https://interviewquestions.tuteehub.com/tag/greater-476627" style="font-weight:bold;" target="_blank" title="Click to know more about GREATER">GREATER</a> than the AC, the AC is pulled up. The point of intersection between the MC and AC curves is also the minimum of the AC curve</body></html>

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