Consider a Firm in the Short Run

question 17

Multiple Choice

Consider a firm in the short run.If AP = MP and both are positive,then total product

• A)is at a maximum.
• B)is decreasing as extra units of the variable factor are employed.
• C)is increasing as extra units of the variable factor are employed.
• D)may be either increasing or decreasing as extra units of the variable factor are employed.
• E)is at its minimum.

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Definitions:

Market Price

The current price at which a good or service can be bought or sold in a given market.

Maximum Price

A price ceiling set by the government or a regulatory body, above which a product or service cannot be sold in the market.

Price Ceiling

A government-imposed limit on how high a price can be charged for a product, service, or commodity.

Government

Government is the system or group of people governing an organized community, often a state.