Assume a subsidy to buyers has been enacted in the market in the graph shown. With the subsidy, the buyers buy ________ units and pay ________ for each of them.

The average product of a variable input is calculated as:

A) total product divided by total output. B) the change in total product divided by the change in the variable input. C) total product divided by the change in the variable input. D) total product divided by the total quantity of the variable input.

Economies of scale

A. require inputs’ MPP to fall as output increases (everything else equal). B. pertain to the long run only. C. refer to increased output generalized by an increase in the quantity of a single input. D. imply that the AC curve will fall continuously as output increases in the short run.