Answer to Question #77055 in Microeconomics for fazila
Assuming a constant wage rate, illustrate and explain using a diagram, how a firm’s marginal cost of production are at a minimum when its marginal product is at a maximum?
The U-shape of the marginal cost curve is closely related to the hump-shape of the marginal product curve. The increasing portion of the marginal product curve corresponds with the decreasing portion of the marginal cost curve. The decreasing portion of the marginal product curve corresponds with the increasing portion of the marginal cost curve. The peak of the marginal product curve corresponds with the minimum of the marginal cost curve. Source: http://www.amosweb.com/cgi-bin/awb_nav.pl?s=wpd&c=dsp&k=marginal+cost+and+marginal+product
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