Which one of the following is NOT true about the relationship between Average Cost (AC) and Marginal Cost (MC)?
1
When MC is falling, the rate of fall in MC is greater than that of AC
2
When MC increases, AC also increase but at a lower rate. However, there is a range of output where MC begins to increase while AC continue to decrease
3
When AC is constant, AC < MC
4
MC curve intersects AC curve at its minimum