D. The marginal cost curve is always increasing due to the law of diminishing marginal returns. E. The total cost curve gets flatter as the quantity of output increases because of diminishing marginal product.

Principles of Economics 2e
2nd Edition
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:Steven A. Greenlaw; David Shapiro
Chapter7: Production, Costs, And Industry Structure
Section: Chapter Questions
Problem 40P: Return to Figure 7.7. What is the marginal gain in output from increasing the number of batters from...
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Answer D and E only.
3. Determined whether each statement is true or false and provided an explanation.
is
A. If a firm has U-shaped marginal cost, then AVC and MC are equal at the point wh
minimized.
B. If marginal cost is increasing, verage cost must increase as well.
C. If a firm'soduction function exhibits decreasing marginal returns in each factor, then it
must also xhibit decreasing returns to scale.
D. The marginal cost curve is always increasing due to the law of diminishing marginal returns.
E. The total cost curve gets flatter as the quantity of output increases because of diminishing
marginal product.
nes
Transcribed Image Text:3. Determined whether each statement is true or false and provided an explanation. is A. If a firm has U-shaped marginal cost, then AVC and MC are equal at the point wh minimized. B. If marginal cost is increasing, verage cost must increase as well. C. If a firm'soduction function exhibits decreasing marginal returns in each factor, then it must also xhibit decreasing returns to scale. D. The marginal cost curve is always increasing due to the law of diminishing marginal returns. E. The total cost curve gets flatter as the quantity of output increases because of diminishing marginal product. nes
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