The correct answer is D. MC.
Average variable cost (AVC) is a measure of the average amount of variable cost per unit of output. It is calculated by dividing total variable cost by the number of units produced. AVC is U-shaped because, as output increases, variable costs per unit decrease due to economies of scale. However, as output continues to increase, variable costs per unit increase due to diseconomies of scale.
Average fixed cost (AFC) is a measure of the average amount of fixed cost per unit of output. It is calculated by dividing total fixed cost by the number of units produced. AFC is always decreasing because fixed costs do not change with output.
Average cost (AC) is a measure of the average amount of total cost per unit of output. It is calculated by dividing total cost by the number of units produced. AC is U-shaped because it is equal to the sum of AVC and AFC, which are both U-shaped.
Marginal cost (MC) is the change in total cost that results from producing one additional unit of output. It is calculated by dividing the change in total cost by the change in output. MC is always increasing because, as output increases, the costs of producing additional units of output increase.