ECO101H1 Study Guide - Midterm Guide: Average Cost, Average Variable Cost, Marginal Cost

The diminishing marginal product explains why, as a firm’s output increases.

a. the production function and total-cost curve both get steeper

b. the production function and total-cost curve both get flattered

c. the production function gets steeper, while the total-cost curve gets flatter.

d. the production function gets flatter, while the total-cost curve gets steeper.

Marginal cost increases as the quantity of output increases. This reflects the property of:

A. Increasing Total Cost
B. Diminishing Total Cost
C. Increasing Marginal Product
D. Diminishing Marginal Product

The total cost curve(or production function) gets steeper as output increases because of:
A) increasing returns to the variable input.
B) decreasing returns to the variable input.
C) increases in fixed cost.
D) decreases in overhead costs.