draw avc,ac  and  mc curves in a single diagram .what relation do you observe among them?

Dear student,

AC is the cost of producing per unit of output.
AC = TC /X
AVC is the variable cost of producing per unit of output.
AVC = TVC / X
MC is the addition to total variable cost or total cost when one more unit of output is produced.
MC = △TVC / △X



Relation between AC, AVC and MC curves
* All AC, AVC and MC curve are U shaped due to law of variable proportion. 
* With increase in level of output the difference between AC and AVC decreases.
* AVC is derived from AC, as AC = ATC + AVC.
* MC and AC are derived from TC, as AC = TC /X and ​MC = △ TC / △X.
* Both AVC and MC are derived from TVC, as AVC = TVC / X and MC = △TVC / △X.
* When AVC and AC falls, MC is below them.
* When AVC and AC rise, MC is above them.
* When AVC is constant, MC=AVC.
* When AC is constant, MC = AC.

Regards