Total cost of production is the sum of total variable cost and total fixed cost. If the total fixed cost alone decreases:
A. the average total cost curve shifts upward at all output levels.
B. the marginal cost curve shifts downward at all output levels.
C. the vertical distance between the average total cost curve and the average variable cost curve decreases at all output levels.
D. the average variable cost curve shifts downward at all output levels.
Answer: C
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