Which one of the following conditions is incorrect? (Where, SMC - Short term Marginal Cost, AVC - Average Variable cost, SAC - Short run average cost, LRMC - Long run marginal cost, LRAC - Long run average cost.)

Question

Option 1: SMC curve cuts the AVC curve from below at the minimum point of AVC

Option 2: SMC curve cuts the SAC curve from below at the minimum point of SAC

Option 3: LRMC curve cuts the LRAC curve from above at the minimum point of LRAC

Option 4: LRMC curve cuts the LRAC curve from below at the minimum point of LRAC

AfterBoards · Accepted Answer

The answer is 'LRMC curve cuts the LRAC curve from above at the minimum point of LRAC'. View full solution:

CUET Economics 2026 6th June Shift 1 PYQs

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