When marginal product is rising
A) total product is falling.
B) marginal cost is falling.
C) marginal cost is rising.
D) average fixed cost is rising.

Question

Quizplus · Accepted Answer

When marginal product is rising, it indicates that the additional output per unit of input is increasing. This means that the firm is experiencing economies of scale, and as a result, the marginal cost is falling. Therefore, B is the correct answer. A is contradictory, as rising marginal product implies a higher total output. C is incorrect, as we have already established that marginal cost is falling. D is also incorrect, as average fixed cost is not related to marginal product.

When Marginal Product Is Rising