Micro

Production & Costs

Medium

Chronologically, arrange the following statements in the context of shape of AP curve.

(A) MP starts falling, the AP continues to rise as long as MP remains higher than AP.

(B) At the first level of output, the MP and the AP are the same.

(C) MP fall sufficiently, its value becomes less than the AP and the AP also falls.

(D) MP rises, AP being the average of marginal products, also rises, but rises less than MP.

Choose the correct answer from the options given below:

(B), (D), (A), (C)

(B), (C), (A), (D)

(A), (C), (D), (B)

(C), (B), (D), (A)

✅ Correct Option: 1

Option 1: (B), (D), (A), (C) -> This represents the correct chronological sequence of the AP curve shape. Starting with (B) where MP and AP are equal at the first output level, then (D) where both rise but MP rises faster, followed by (A) where MP falls but AP continues rising as MP > AP, and finally (C) where MP falls below AP causing AP to also fall. This sequence correctly describes the typical production relationship where MP initially equals AP, rises above it, then falls below it, causing AP to eventually decline -> correct

2025: 2 June Shift 1

When Marginal Product is constant?

2025: 14 May Shift 1

As long as average cost is falling

2026: 31 May Shift 1

Input	Output	Marginal productivity of factor
$10\ L_1$	$20\ Q_1$	$MP_L = ?$
$12\ L_2$	$25\ Q_2$
$8\ K_3$	$16\ Q_3$	$MP_K = ?$
$10\ K_4$	$20\ Q_4$

Where labour input $L_1$ and $L_2$ are related to output $Q_1$ and $Q_2$ respectively

Capital input $K_3$ and $K_4$ are related to output $Q_3$ and $Q_4$ respectively

Find the values of $MP_L$ and $MP_K$ .

2026: 13 May Shift 2

Choose correct statements from the following with reference to short-run cost curves:

(A) AVC and AC curves are 'U'-shaped.

(B) SMC curve cuts the AVC curve from below at the minimum point of AVC.

(D) SMC curve is 'U' -shaped.

Choose the correct answer from the options given below:

2025: 22 May Shift 1

In the long run, average cost must be rising as the firm increases output as long as the.......... operates.

2026: 20 May Shift 1

Match List-I with List-II

List-I	List-II
(A) Total Cost (TC)	(I) Total variable cost/ Quantity (TVC/Q)
(B) Average Variable Cost (AVC)	(II) Total Fixed Cost / Quantity (TFC/Q)
(C) Short run average cost (SAC)	(III) Total Variable Cost + Total Fixed Cost.
(D) Average fixed cost (AFC)	(IV) Average Variable Cost + Average Fixed Cost.

Choose the correct answer from the options given below:

Solution

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