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When total product is rising a. variable cost must be declining. b. fixed cost must be rising. ...

Question:

When total product is rising

a. variable cost must be declining.

b. fixed cost must be rising.

c. marginal product must be positive.

d. marginal product must be negative.

Total Product:

Total product is a term used in economics. It tells analysts how much output (quantity) a company can produce when considering the law of diminishing marginal returns. It is calculated as follows:

Total Product = Average Product * Number of units of a factor employed

Total product is the overall quantity of output that a firm produces, usually specified in relation to a variable input. Total product is the starting point for the analysis of short-run production. It indicates how much output a firm can produce according to the law of diminishing marginal returns

Answer and Explanation:

The answer is: c. marginal product must be positive. In general, the marginal product is positive, especially if total product is increasing.

a. variable cost must be declining.

False, variable costs increase when production levels increase.

b. fixed cost must be rising.

False, fixed costs remain the same.

d. marginal product must be negative.

False, this would mean total product is decreasing.


Learn more about this topic:

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Total Product, Average Product & Marginal Product in Economics

from Economics 101: Principles of Microeconomics

Chapter 4 / Lesson 2
58K

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