A logarithmic variable cost function implies that:
A) marginal cost is increasing at a decreasing rate.
B) marginal cost is increasing at an increasing rate.
C) marginal cost is constant.
D) marginal cost is decreasing as quantity increases.

Question

Quizplus · Accepted Answer

A logarithmic variable cost function implies that the marginal cost is increasing at a decreasing rate. This is because the slope of the cost function (which represents marginal cost) decreases as the quantity increases in a logarithmic function.

A Logarithmic Variable Cost Function Implies That