Which One of the Following Statements Is Correct

question 142

Multiple Choice

Which one of the following statements is correct?

• A)When marginal product is increasing,average product is decreasing.
• B)When average product is less than zero,marginal product is positive.
• C)When marginal product is increasing and greater than average product,average product is increasing.
• D)When marginal product is zero,total product is at its minimum.
• E)When average product exceeds marginal product,marginal product is increasing.

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Definitions:

Constant Costs

Costs that do not change with the level of output or activity within a certain range.

Short-run Supply Curve

A graphical representation showing the relation between the price of a product and the quantity of the product that a firm is willing and able to sell, given fixed resources.

MC Curve

A graph that shows the relationship between the marginal cost and the quantity of output produced, typically upward sloping.

Shut-down Price

The price level at which a firm ceases its operations because the revenue received does not cover the variable costs, making it financially unsustainable to continue.