Why does marginal cost increase as more is produced?
A) The marginal product of labor increases, so more additional labor must be used to increase output, increasing total cost.
B) The marginal product of labor increases, so less additional labor must be used to increase output, increasing total cost.
C) The marginal product of labor decreases, so more additional labor must be used to increase output, decreasing average cost.
D) The marginal product of labor decreases, so more additional labor must be used to increase output, increasing total cost.
Correct Answer:
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