If a firm experiences constant returns to the variable input in the short run:
A) marginal product will be greater than average variable product, but the two will become more equal as output increases.
B) marginal product will be less than average variable product, but the two will become more equal as output increases.
C) marginal product will be greater than average variable product, and the difference between the two will become larger as output increases.
D) marginal product and average variable product will be equal over the range of output in question.
D
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Any output combination along a production possibility frontier is associated with overused or unattainable resources
Indicate whether the statement is true or false
Which of the goals pursued by policymakers in an open economy is desirable because it can reduce the severity of business cycles?
A) exchange-rate stability B) monetary policy independence C) free capital flows D) appreciation of the domestic currency