A firm is producing 1,000 units at a total cost of $5,000. If it were to increase production to 1,001 units, its total cost would rise to $5,008.What does this information tell you about the firm?a. Marginal cost is $5, and average variable cost is $8.b. Marginal cost is $8, and average variable cost is $5.c. Marginal cost is $5, and average total cost is $8.d. Marginal cost is $8, and average total cost is $5
A firm is producing 1,000 units at a total cost of $5,000. If it were to increase production to 1,001 units, its total cost would rise to $5,008.What does this information tell you about the firm?a. Marginal cost is $5, and average variable cost is $8.b. Marginal cost is $8, and average variable cost is $5.c. Marginal cost is $5, and average total cost is $8.d. Marginal cost is $8, and average total cost is $5
Essentials of Economics (MindTap Course List)
8th Edition
ISBN:9781337091992
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter12: The Cost Of Production
Section: Chapter Questions
Problem 3CQQ
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A firm is producing 1,000 units at a total cost of $5,000. If it were to increase production to 1,001 units, its total cost would rise to $5,008.
What does this information tell you about the firm?
a. Marginal cost is $5, and
b. Marginal cost is $8, and average variable cost is $5.
c. Marginal cost is $5, and
d. Marginal cost is $8, and average total cost is $5
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