Question

why MC(marginal cost) has a U shaped curve?

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Answer 1

It is due to operation of law of variable proportion according to which Mp first rises , reaches its maximum and then declines. Since increasing returns means diminishing cost and diminishing returns imply increasing cost, therefore, MC first falls because of increasing returns, reaches its minimum and then rises due to operation of diminishing returns. As a result MC curve becomes U-shaped.

Note :- This is totally correct answer

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