Asked by Frank pelicano on Jul 16, 2024
Verified
The shape of the marginal cost curve tells a producer something about the marginal product of her workers.
Marginal Cost Curve
The marginal cost curve graphically represents how the cost of producing one additional unit of a good changes as production volume varies.
Marginal Product
The increased output achieved by adding one more unit of a certain input, with all other inputs held steady.
- Comprehend the concept of diminishing marginal product and its influence on overall production.
- Familiarize oneself with the connection between marginal cost and average total cost and its importance in determining production plans.
Verified Answer
NS
Nicholas ShammaJul 20, 2024
Final Answer :
True
Explanation :
The shape of the marginal cost curve is inversely related to the marginal product of labor. When the marginal product of labor is rising, marginal costs are decreasing, and when the marginal product of labor is falling, marginal costs are increasing. This relationship is due to the fact that the cost of producing an additional unit of output (marginal cost) is influenced by the productivity of the additional labor (marginal product) used to produce that unit.
Learning Objectives
- Comprehend the concept of diminishing marginal product and its influence on overall production.
- Familiarize oneself with the connection between marginal cost and average total cost and its importance in determining production plans.
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