Asked by
Shakti Prasad
on Nov 04, 2024
Verified
In the short run, marginal cost is positive and increasing at output levels where total variable cost is ________ at a(n) ________ rate.
A) increasing; increasing
B) increasing; decreasing
C) decreasing; increasing
D) decreasing; decreasing
Marginal Cost
Incremental cost incurred when one more unit of a product or service is produced.
Total Variable Cost
The sum of expenses that change in proportion to the activity or volume of production.
- Assess the functioning and relationship of cost curves (MC, AVC, AFC, TC, ATC) amidst the circumstances of short-term production.
- Understand the sequence of production stages, including increasing returns, diminishing returns, and negative returns, as it pertains to the law of diminishing marginal returns.
Verified Answer
AC
Learning Objectives
- Assess the functioning and relationship of cost curves (MC, AVC, AFC, TC, ATC) amidst the circumstances of short-term production.
- Understand the sequence of production stages, including increasing returns, diminishing returns, and negative returns, as it pertains to the law of diminishing marginal returns.