Variable Costs

question 73

Multiple Choice

Variable costs

• A)decrease with increasing output.
• B)increase with decreasing output.
• C)decrease with decreasing output.
• D)might increase or decrease with increasing output.

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Definitions:

Market Wage

The prevailing wage rate paid for a specific job in the labor market, determined by the supply and demand for that type of labor.

Market Price

The going rate at which an asset or service can be acquired or disposed of in a certain market.

Marginal Product

The additional output gained by employing one more unit of a specific input, holding all other inputs constant.

Market Wage

The average wage earned by workers in a specific market or industry, determined by the supply and demand for labor in that market.