37.2k views
4 votes
Suppose you are the owner of a small t-shirt printing business. while conducting a cost analysis of your business, you find that at current production levels, your average total costs (atc) are $10. you also know that if you increase production by one more unit, the marginal cost of that unit will be $5. if you produce another t-shirt:

User Mert Inan
by
8.2k points

1 Answer

3 votes
If the owner produce another t-shirt, the average total costs of production will decrease. This is so, since the cost will be shared by the additional shirt.
User Mfnalex
by
7.6k points
Welcome to QAmmunity.org, where you can ask questions and receive answers from other members of our community.