D Question 28 5 pts the marginal cost curve intersects the average total cost cu

Question

D Question 28 5 pts the marginal cost curve intersects the average total cost curve module 8 where average total cost equals average variable cost O O at the minimum of the marginal cost O where the marginal cost is maximized O at the minimum of the average total cost D Question 29 5 pts if cost per unit is rising with larger plant size, in the long run average cost curve . module 8 O O O O we are in the constant returns to scale we are in the positive returns to scale we are in the diseconomies of scale we are in the economies of scale

Explanation / Answer

28. The marginal cost curve intersects the average total cost curve at the minimum of the average total cost curve.

So, the correct answer is "at the minimum of the average total cost curve".

29. If LRAC is falling then the firm is experiencing the economies of scale.

If LRAC is rising then firm is experiencing the diseconomies of scale

If LRAC is constant then the firm is experiencing the constant return to scale.

Thus, if the cost per unit is rising with larger plant size, in the long run, average cost curve we are in the diseconomies of scale.

So, the correct answer is "We are in the diseconomies of scale".

30. If marginal benefit of an additional labor, MPL / PL, greater than the marginal benefit of an additional capital, MPK / PK, then the profit-maximizing firm will be better off by spending more on the labor and less on capital.

Thus, if MPL / PL > MPK / PK, then the profit-maximizing firm should use more labor.

So, the correct answer is " Use more labor".

31. If productivity increases then cost per unit falls.

So, the correct answer is "cost per unit falls".

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