Regarding the relationship between marginal profit and average profit, which of the following statements is NOT true?
A)If the average profit is rising, the marginal profit figure must be rising.
B)If marginal profit is lower than average profit, then average profit must decrease when profit increases.
C)If marginal profit is below average profit, the average profit decreases.
D)All of these statements are true.

Question

Quizplus · Accepted Answer

Statement A is not true because if the average profit is rising, it does not necessarily mean that the marginal profit must be rising as well. Marginal profit could be above or below the average profit and still cause the average profit to rise, as long as it is positive.

Regarding the Relationship Between Marginal Profit and Average Profit, Which