Quiz Homework 03 O MC remains the same O Any of the above answers could be corre

Question

Quiz Homework 03 O MC remains the same O Any of the above answers could be correct, depending on the industry Question 12 2 pts Think about the general relationship between the marginal product of labor (MPL) and the marginal cost of output (MC). As MPL decreases, what happens to MC? MC increases O MC decreases MC remains the same O Any of the above answers could be correct, depending on the industry Question 13 2 pts If the margin is greater than the average, what can we say about the average and margin? The average is at its maximum O The average is at its minimum

Explanation / Answer

Answer:

MPL decreases what happens to MC:

A: MC increases

Because generally there is inverse relationship between marginal product of labour and marginal cost of output means when MPL increases MC is decreasing and when MPL decreasing MC increases eventually

If the margin is greater than the average, what can we say about the average and margin:

C: the average is rising

Because a new unit is added in the average when margin is greater than average so it increases average

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