If marginal cost is positive and falling ?
Correct answer: B. Total cost is increasing at a falling rate
- A. Total cost is falling
- B. Total cost is increasing at a falling rate
- C. Total cost is falling at a falling rate
- D. Total cost is increasing at an increasing rate
Explanation
A positive marginal cost means each extra unit increases total cost, while falling marginal cost means those increases become progressively smaller. Therefore, total cost increases at a falling rate.
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Individual consumers, firms and markets are examined through demand and supply, elasticity, consumer choice, production, costs, revenue and the determination of prices and output. The topic also covers market structures such as perfect competition, monopoly and oligopoly, plus market failure, externalities and the distinction between microeconomic decisions and economy-wide outcomes.
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