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In the Short Run Marginal Product of Labor Initially Rises

Question 84

Multiple Choice

In the short run marginal product of labor initially rises and then falls there may be two output levels where marginal revenue equals marginal cost. In this case how does a firm choose the appropriate output level?


A) choose the lower of the two output levels
B) choose the point where marginal costs falling
C) choose the point where average cost is minimized
D) choose the point where marginal cost is rising

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