Asked by Ashley Bull Calf on May 19, 2024
Verified
When returns are diminishing,the marginal cost curve is upward-sloping.
Marginal Cost Curve
A graphical representation that shows how the cost of producing one more unit of a good varies as production volume changes.
Diminishing Returns
A principle stating that as additional units of a variable input are added to a fixed input, the marginal product of the variable input eventually decreases.
Upward-Sloping
Describes a line or curve on a graph that moves higher on the y-axis as it moves to the right on the x-axis, typically used to describe a supply curve in economics.
- Acquire knowledge about the theory of diminishing returns and its repercussions on production costs and volume.
Verified Answer
JM
Jessica MohannaMay 20, 2024
Final Answer :
True
Explanation :
When returns are diminishing and output increases, the additional costs of producing each additional unit of output are likely to increase as well. This results in an upward-sloping marginal cost curve.
Learning Objectives
- Acquire knowledge about the theory of diminishing returns and its repercussions on production costs and volume.