Figure 7-2 Shows the Total Product Curve for Different Levels

question 20

Multiple Choice

Figure 7-2 shows the total product curve for different levels of a variable input,labor.
Figure 7-2
-Refer to Figure 7-2.Which of the following is true when the labor input is between points C and D?

• A)marginal product reaches a maximum and then declines.
• B)marginal product reaches a maximum and then becomes negative.
• C)average product is equal at point B and C.
• D)total product is increasing at a decreasing rate.

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Definitions:

Marginal Utility

The additional satisfaction or benefit (utility) that a consumer derives from consuming an additional unit of a good or service.

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Consumer Surplus

The contrast between the full amount consumers are willing to invest in a product or service and the actual payment they make.

Action Figures

Small figures representing a character from a movie, comic book, video game, or television program, designed for play or collection.