• State the relationship between (ATC) average total cost, and marginal cost (MC) when

1. ATC is decreasing, is ATC is above (greater), equal, or less (below) than MC? ________ choose one
2. ATC is minimum, is ATC is above, equal or less than MC? __________ choose one
3. ATC is increasing, is ATC is above, equal, or less than MC? _________ choose one

• If production increases, what happens to average fixed cost (AFC), does it increase only, decrease only, or decrease, increase and then increase? _______________ choose one

• If production increases, what happens to average variable cost (AVC), does it increase only, decrease only, or decrease, increase and then increase? _______________ choose one

• If production increases, what happens to average total cost (ATC), does it increase only, decrease only, or decrease, increase and then increase? _______________ choose one

• Graph AFC, AVC, AVC, label your graphs (what you plot on the horizontal and vertical axes).