Which of the following is true with respect to LRAC (Long run average cost) and LRMC (Long run marginal cost)?
1
LRMC curve cuts the LRAC curve from below at the minimum point of LRMC.
2
LRAC curve cuts the LRMC curve from below at the minimum point of LRAC.
3
LRMC curve cuts the LRAC curve from below at the minimum point of LRAC.
4
LRAC curve cuts the LRMC curve from below at the minimum point of LRMC.