Question 6.11

6. Evaluate each of the following statements. If a statement is true, explain why; if it is false, identify the mistake and try to correct it.

  1. A decreasing marginal product tells us that marginal cost must be rising.

  2. An increase in fixed cost increases the minimum-cost output.

  3. An increase in fixed cost increases marginal cost.

  4. When marginal cost is above average total cost, average total cost must be falling.