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Chapter 20: Problem 30

When total output is maximized, marginal output is __________ (LO6) a) rising b) falling c) positive d) negative e) zero

Short Answer

Expert verified
When total output is maximized, marginal output is \(e) \text{ zero}\).

Step by step solution

01

Understanding the terms

Total output is the overall production resulting from an input, while marginal output is the additional output generated by utilizing one more unit of input.
02

Analyzing the relationship between total output and marginal output

To maximize output, an organization must use inputs efficiently. When total output is maximized, it means that no further increase in input will result in increased production. In this situation, we need to find the point where increasing input does not lead to an increase in output. When the output is maximized, it means that a further increase in input by one unit will not change the output. Therefore, the change in output (marginal output) will not be rising or falling, but will be equal to zero.
03

Answering the question

Based on our analysis in Step 2, the correct answer is: e) zero

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Most popular questions from this chapter

Statement 1: AVC can never be higher than ATC. Statement 2: \(\mathrm{AVC}\) and marginal cost are equal at an output of one __________ (LO4) a) Statement 1 is true, and statement 2 is false. b) Statement 2 is true, and statement 1 is false. c) Both statements are true. d) Both statements are false.

Average variable cost is found by dividing __________ (LO4) a) variable cost by output b) output by variable cost c) marginal cost by output d) output by marginal cost

In Figure 1 , if you want to produce an output of 100 , in the long run you will choose a plant whose size is represented by __________\((\mathrm{LO8})\) a) \(\mathrm{ATC}_{1}\) b) \(\mathrm{ATC}_{2}\) c) \(\mathrm{ATC}_{3}\) d) \(\mathrm{ATC}_{4}\) e) \(\mathrm{ATC}_{5}\)

Which statement is true? (LO8) a) A firm will operate in the short run when total revenue exceeds fixed costs. b) A firm will operate in the short run when total revenue exceeds variable costs. c) A firm will shut down when total cost equals total revenue. d) None of these statements is true.

Which of the following is the most accurate statement? (LO1,8) a) Virtually no one getting married thinks that considering whether or not to have a large wedding is mainly an economic decision. b) Most American families holding large weddings get by for less than \(\$ 2,000\). c) When making a wedding, it is impossible to think in terms of fixed costs and variable costs. d) Whether to hold a wedding in city hall or in a wedding hall is at least partially an economic decision.
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