
-Refer to the above table. Which of the following statements is correct?
A) The table follows economic principles because in an increasing cost industry, increases in a variable input will lead to increase in output.
B) The table does not follow economic principles because in an increasing cost industry, increases in a variable input will lead to decrease in output.
C) The table follows economic principles because the law of diminishing marginal product predicts that increase in a variable input will eventually lead to a decrease in the marginal physical product.
D) The table does not follow economic principles because the law of diminishing marginal product predicts that increase in a variable input will eventually lead to an increase in the marginal physical product.
Correct Answer:
Verified