Inter-relationship between AVC, ATC and AFC

The inter-relationship between AVC, ATC and AFC can be summed up as follows:

  1. If both AFC and AVC fall, ATC will fall.
  2. If AFC falls but AVC rises;
  3. ATC will fall where the drop in AFC is more than the rise in AVC.
  4. ATC will not fall where the drop in AFC is equal to the rise in AVC.
  5. ATC will rise where the drop in AFC is less than the rise in AVC.

One thought on “Inter-relationship between AVC, ATC and AFC”

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