Final answer:
Average cost curves and marginal cost curves in economics tend to have a U-shaped pattern due to economies of scale and diseconomies of scale.
Step-by-step explanation:
Average cost curves and marginal cost curves in economics tend to have a U-shaped pattern. They start by decreasing, then reach a minimum point, and finally start increasing again. This U-shaped pattern is primarily due to the presence of economies of scale and diseconomies of scale.
When a firm initially increases its production, it benefits from economies of scale, which result in lower average costs. This leads to the downward-sloping portion of the U-shaped average cost curve. However, as the firm continues to expand, it may encounter diseconomies of scale, such as inefficiencies or higher costs. These diseconomies cause average costs to start rising, leading to the upward-sloping portion of the U-shaped curve.
Marginal cost curves typically follow a similar pattern to the average cost curves because both curves are influenced by the same factors. However, the marginal cost curve may be harder to see as most of it is increasing since marginal costs tend to rise as production levels increase.