Why is the MC curve U-shaped?
Understand the Problem
The question is asking about the shape of the marginal cost (MC) curve in economics, specifically why it is U-shaped. This typically relates to the concepts of economies of scale and the law of diminishing returns.
Answer
The marginal cost curve is U-shaped due to the law of variable proportions.
The final answer is that the marginal cost curve is U-shaped due to the law of variable proportions, which causes marginal cost to initially decrease, reach a minimum point, and then increase.
Answer for screen readers
The final answer is that the marginal cost curve is U-shaped due to the law of variable proportions, which causes marginal cost to initially decrease, reach a minimum point, and then increase.
More Information
The U-shape of the marginal cost curve reflects the transition from increasing to diminishing marginal returns as production increases.
Sources
- Why is the short run marginal cost curve 'U' shaped? - BYJU'S - byjus.com
- Why is the MC (marginal cost) curve U-shaped? - Study.com - homework.study.com
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