Which of the following is true of the relationship between marginal cost and marginal product?
A)Marginal product and marginal cost are not related to each other.
B)When marginal product increases, marginal cost increases.
C)When marginal product increases, marginal cost falls.
D)When marginal product is negative, marginal cost is negative.
E)When diminishing marginal returns set in, marginal cost falls.

Question

Quizplus · Accepted Answer

When the marginal product of an input increases, it means that each additional unit of input produces more output than the previous unit. This efficiency reduces the cost of producing each additional unit, hence the marginal cost falls.

Which of the Following Is True of the Relationship Between