The Costs of Production

The Costs of Production

21. The average total cost curve is unaffected by
diminishing marginal product.

22. The average total cost curve reflects the
shape of both the average fixed cost and average variable cost curves.

23. If the marginal cost curve is rising, so is
the average total cost curve.

24. The marginal cost curve intersects the
average total cost curve at the minimum point of the average total cost curve.

25. A second or third worker may have a higher
marginal product than the first worker in certain circumstances.

26. Assume Jack received all A’s in his classes
last semester. If Jack gets all C’s in his classes this semester, his GPA may
or may not fall.

27. Average total cost and marginal cost are
merely ways to express information that is already contained in a firm’s total
cost.

28. Average total cost reveals how much total
cost will change as the firm alters its level of production.

29. The shape of the marginal cost curve tells a
producer something about the marginal product of her workers.

30. When average total cost rises if a producer
either increases or decreases production, then the firm is said to be operating
at efficient scale.


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