Suppose That a Firm's Capital Is Fixed and One More

Multiple Choice

Suppose that a firm's capital is fixed and one more unit of labour is hired,thereby increasing the firm's total output.Which of the following statements can be correct? 1.Marginal cost would remain constant.
2.Marginal cost would increase.
3.Marginal cost would decrease.

A) 1 only
B) 2 only
C) 3 only
D) Any of 1,2,and 3 is possible.
E) None are possible.