Because the marginal product of a variable resource at first increases and then decreases as the output of the firm is increased:
A. total cost at first increases at a decreasing rate and then increases at an increasing rate.
B. total variable cost at first increases at an increasing rate and then increases at a
decreasing rate.
C. average total cost at first increases and then diminishes.
D. average fixed cost will rise beyond the point of diminishing returns.
Answer: A
You might also like to view...
An increase in the nominal interest rate creates a ________ the money demand curve, and an increase in real GDP creates a ________ the money demand curve
A) movement down along; leftward shift of B) rightward shift of; movement up along C) movement up along; rightward shift of D) leftward shift of; rightward shift of
Which one of the following is NOT a determinant of demand?
A) prices of related goods B) cost of inputs in production C) income D) future price expectations
For a perfectly competitive firm,
a. marginal revenue is the same as the market price b. marginal revenue equals total revenue c. to earn an economic profit, it must be larger than its competitors d. price always exceeds average total cost e. marginal cost is always equal to average cost
The opportunity set contains:
a. a single combination of consumption that someone can afford given the prices of goods and the individual’s income. b. all possible combinations of consumption that someone can afford given the prices of goods regardless of the individual’s income. c. all possible combinations of consumption that someone can afford given the prices of goods and the individual’s income. d. a single combination of consumption that someone can afford given the prices of goods regardless of the individual’s income.