If the Price of a Fixed Factor of Production Increases

question 46

Multiple Choice

If the price of a fixed factor of production increases by 50 percent, what effect would this have on the marginal-cost schedule facing a firm?

• A)None, because fixed costs do not affect marginal cost.
• B)Marginal cost would increase by 50 percent.
• C)Marginal cost would increase by less than 50 percent.
• D)Marginal cost would increase by more than 50 percent.

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