Final answer:
Without the shape of the ATC curve, it's unclear if the firm has higher fixed costs or a different cost behavior. However, an upward-sloping marginal cost curve suggests increasing costs with more output produced, resulting in a leftward shift of the firm's supply curve if marginal costs rise.
Step-by-step explanation:
If the student is presented with an average total cost (ATC) curve but no specific information about the shape of the curve, we cannot determine the exact answer from the options provided. However, if we assume a typical U-shaped cost curve, the firm will exhibit certain behaviors relative to its costs. The average total cost (ATC) is calculated by dividing the total cost by the quantity of output produced. Since the ATC includes average fixed costs (AFC) and the average variable costs (AVC), the notion of the firm having zero fixed cost (option A) can be dismissed because ATC would not exist without fixed costs.
The shape of the marginal cost (MC) curve is typically upward sloping because it represents the additional cost of producing one more unit, which suggests that option D (the firm has a diminishing marginal cost) is not true; MC usually increases as output increases due to the law of diminishing returns. Option C is ambiguous without additional information about the actual cost figures, so we cannot conclude that the firm has higher fixed costs solely from the shape of the ATC curve.
When marginal costs increase, the firm's individual supply curve shifts to the left, meaning the firm will supply less quantity at each price level. This shift reflects the higher cost of producing additional units of output.