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1. If the marginal cost of producing a good is increasing as a firm produces more of the good, then which of the following must be true?
a. AFC is rising b. AVC is rising c. MC > AVC d. MPL is falling
2. The equality of marginal cost and average variable cost occurs when
a. marginal cost is minimal c. average product of the variable input is minimal
b. average variable cost is minimal d. none of the previous statements is correct 3. Suppose the short-run production function is Q=10L and the wage rate equals $10. Find the average variable cost.
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