If the marginal cost curve is below the average variable cost curve, then
A. average variable cost is decreasing.
B. average variable cost is increasing.
C. marginal cost is increasing.
D. average variable cost is constant.
Answer: A
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To correct a market failure, society typically relies on
a. the market to correct itself b. individual producers' cost-minimization procedures c. the industry policing itself d. the government to either tax, subsidize, or control output directly e. price to reach equilibrium
"All else constant, consumers will purchase more of a good as the price falls." This statement reflects the behavior underlying:
A. the demand curve. B. the supply curve. C. a change in demand. D. a change in supply.
A perfectly competitive firm currently sells 30,000 cartons of eggs at $1.25 each. If the firm wants to sell one more carton of eggs, the firm:
A.) Should raise its price above $1.25. B.) Cannot sell an additional carton at any price because there are other egg farmers in the market. C.) Must sell the carton for less than $1.25. D.) Should price the carton at $1.25.
When government inefficiencies exist and government officials can be bribed, then
A. property rights will be more secure since an official has been bribed to grant ownership to the business. B. a bribe will increase the cost of investing in capital. C. the country will have positive economic growth. D. dead capital will not exist.