If law of diminishing return is in operation average cost
Decreases
Increases
Remains constant
Decreases slowly
Total revenue equals
Price plus the quantity
Price multiplied by the quantity sold
Price divided by the quantity sold
Price minus the quantity sold
The law of diminishing returns assumes
There are no fixed factors of production
There are no variable factors of production .
Utility is maximised when marginal product falls
Some factors of production are fixed
If marginal product is below average product .
Fall
Rise
Constant
Slowly rise
The average variable cost curve
Is derived from the average fixed costs
Converges with the average cost as output increases
Equals the total costs divided by the output
Equals revenue minus profits
Which one of the following statement is true ?
If the marginal cost is greater than the average cost the average cost falls
If the marginal cost is greater than the average cost the average cost increases.
If the marginal cost is positive total costs are maximised.
If the marginal cost is negative total costs increase at a decreasing rate if output increases.
_______ increases and decreases with the volume of output .
Fixed cost
Variable cost
Total cost
Money cost
Economic profit is the difference between total revenue and
Average cost
Marginal cost
Economic cost
In the long term a firm will produce the revenue covers
Fixed costs
Variable costs
Total costs
Sales
When internal economics of scale occur
Total costs falls
Marginal cost increase
Average costs fall
Revenue fall
