Question

Why does AC curve lie above AVC curve?

Answer 1

Answer:

AC, AVC and MC curves are U-shaped because of Law of Variable Propertions. (iv) The gap between them is TFC, which remains same with rise in output. (v) AC curve lies above the AVC curve because both AVC and AFC at all levels of output. (vi) It happen because both TC and TFC are same at zero level of output.

Answer 2

Answer:

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Explanation:

AC, AVC and MC curves are U-shaped because of Law of Variable Propertions. (iv) The gap between them is TFC, which remains same with rise in output. (v) AC curve lies above the AVC curve because both AVC and AFC at all levels of output. (vi) It happen because both TC and TFC are same at zero level of output.