If a production process exhibits diminishing returns, then as output rises:
A. total revenue will eventually decrease.
B. average total cost will eventually decrease.
C. marginal cost will eventually increase.
D. total fixed cost will eventually increase.
Answer: C
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One type of economic regulation often used in the United States by various public utility commissions allows prices to reflect only the actual cost of production and no monopoly profits. This type of economic regulation is known as
A) rate-of-return regulation. B) cost-of-service regulation. C) price per constant-quality-unit regulation. D) creative response regulation.
The demand curve is downward-sloping because of the law of ____
a. diminishing marginal utility b. diminishing consumer equilibrium c. consumer equilibrium d. diminishing utility maximization
In the monetarist view, the money supply affects the economy
A. through investment spending and government spending. B. indirectly through interest rates. C. directly, apart from interest rates. D. by altering the size of the money multiplier.
A constant-cost industry is one in which:
A. input prices do not change as output changes in the long run. B. supply is highly inelastic. C. the short-run supply curve is horizontal. D. All of these