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Question:

Why does the SMC curve cut the AVC curve at the minimum point of the AVC curve? 

Answer:

SMC curve intersects SAC curve at its minimum point. This is because as long as SAC is falling, SMC remains below SAC and when SAC starts rising, SMC remains above SAC. SMC intersects SAC at its minimum point P, where SMC = SAC.


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  • Answered by Ekta Mehta
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