If Marginal Cost Is Less Than Average Variable Cost and Output

question 134

Multiple Choice

If marginal cost is less than average variable cost and output increases, average total cost ________ and average variable cost ________.

• A) increases; increases
• B) decreases; decreases
• C) decreases; increases
• D) increases; decreases

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Definitions:

Lockout

An employment and negotiation strategy in which an employer prevents employees from working during a dispute, aiming to pressure the union into concessions.

Strike

A work stoppage initiated by employees as a form of protest, typically in an attempt to gain concessions from their employer regarding pay, conditions, or policies.

Union Membership

The status of being a member of a labor union, an organization that represents the collective interests of workers in negotiations with employers over wages, benefits, and working conditions.

Labor Force

The total number of people who are eligible and able to work, including those currently employed and those seeking employment.