If Total Cost Rises as the Level of Output Produced

question 38

Multiple Choice

If total cost rises as the level of output produced increases,then:

• A)marginal cost must be rising.
• B)marginal cost must be constant.
• C)marginal cost must be falling.
• D)marginal cost must be positive.

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Definitions:

Satisfice

To select the first alternative that is “good enough,” because the costs in time and effort are too great to optimize.

Bounded Rationality

A concept suggesting that individuals make decisions based on the limited information available to them and within the constraints of their cognitive capacity.

Optimizing

The process of making something as effective, perfect, or functional as possible, often by choosing the best option from a set of alternatives.

Programmed Decisions

Decisions that are routine and repetitive, often made using established guidelines or procedures.