Assume a company is at a point in production where marginal product is above average product. Which of the following must be true?
A. Marginal product must be rising.
B. Diminishing marginal product must not have set in yet.
C. Average product must be rising.
D. All of these are true.
Answer: C
Economics
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Suppose a Pigovian tax is imposed on a market that is characterized by one or more externalities. Is this a command-and-control policy or is it a market-based policy?
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