Read the two statements and choose the correct option.

I. The fixed cost is the cost when nothing is produced, $C(0)$.

II. The average cost of a unit is always more than the marginal cost.

Explanation

1. 01

   I: $C(0)$ is what must be paid even at zero output, such as rent. True.

2. 02

   II: for $C(x) = 2x^{2} + 10x + 200$ at $x = 20$, the average is 60 but the marginal cost is 90. False.