**Question:** A firm will _______ at the output where marginal cost increases.**Options:**- a. begin to experience diminishing returns- b. become profitable- c. begin to experience increasing returns- d. start to experience losses**Explanation:**This question is asking about the behavior of a firm at the point where its marginal cost starts to rise. It asks students to identify the economic concept associated with this event. The correct answer is option (a): "begin to experience diminishing returns." This is because, traditionally, as a firm increases output beyond a certain point, adding additional units of input results in smaller increases in output, leading to higher marginal costs.

Marginal cost refers to the Change in total cost with respect to change in quantity.Ans) the correct option is a) begin to experience diminishing returns. When marginal cost increases, the marginal productivity of a good decreases. The additional cost in order to produce more increases. Diminishing returns refers to the decrease in the marginal product as the amount of a single factor of production increases.

Answered: A firm will at the output where…

Business

Economics

A firm will at the output where marginal cost increases O a. begin to experience diminishing returns O b. become profitable O c. begin to experience increasing returns O d. start to experience losses

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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