Marginal cost curve intersects average cost curve at _____.
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → At minimum point of average cost curve.
The Marginal Cost (MC) curve always intersects the Average Cost (AC) curve at its minimum point.
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When MC < AC, the average cost is falling.
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When MC > AC, the average cost is rising.
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Therefore, MC = AC only at the minimum point of the AC curve.