When average variable costs are rising
A) marginal physical product is also rising.
B) marginal costs is falling.
C) average physical product is rising.
D) average physical product is falling.

Question

Quizplus · Accepted Answer

When average variable costs are rising, it means that the cost of producing each additional unit is increasing. This indicates that the marginal physical product is likely falling. Average physical product may or may not be rising, but it is not relevant to the question.

When Average Variable Costs Are Rising