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Why is the atc curve is positioned at a higher level than the avc curve?
Wiki User
∙ 9y ago
This is because the total cost includes both the variable and the fixed costs. Thus it is greater than the variable cost alone. This is why it's curve is above the AVC curve.
Wiki User
∙ 9y ago
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Why does the minimum point of avc curve lie to the right of minimum point of mc curve?
AVC=AC-AFC,the AVC curve is simply the vertical difference between the AC and AFC curve, AFC gets less, the gap between AVC andAC narrows.since all marginal costs are variable ,the same relationship holds between MC and AVC as it did between MC and AC ,that is ,when MC is less than AVC ,it must be falling, if MC is greater than AVC .it must be rising, so ,as with the AC curve ,the MC curve crosses the AVC curve at its minimum point
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