If Franco's Pizza Parlor knows that the marginal cost of the 5000th pizza is $3.50 and that the average total cost of making 499 pizzas is $3.30, then
a. average costs are rising at Q= 500.
b. average costs are falling at Q=500.
c. total costs are falling at Q= 500.
d. average variable costs must be falling.
Answer: A
Microeconomics
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