The derivative, dAC(Q)/dQ = (1/Q2) {Q(dC/dQ) ? C(Q)}, illustrates that when:
A. MC(Q) < AC(Q), average costs increase as output increases.
B. MC(Q) > AC(Q), average costs decrease as output increases.
C. MC(Q) < AC(Q), average costs decrease as output increases.
D. None of the answers are correct.
Answer: C
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