Regarding the relationship between marginal profit and average profit, which of
ID: 1174396 • Letter: R
Question
Regarding the relationship between marginal profit and average profit, which of the following statements is NOT true?
?If marginal profit is lower than average profit, then average profit must decrease when profit increases.
?If the average profit is rising, the marginal profit figure must be rising.
?All of these statements are true.
a.?If marginal profit is lower than average profit, then average profit must decrease when profit increases.
b.?If the average profit is rising, the marginal profit figure must be rising.
c.?All of these statements are true.
Explanation / Answer
All of the given statements are true. i.e when marginal profit is lower than average profit ,then average profit must decrease when profit increases. And if the average profit is rising, the marginal profit must be rising.
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