Target Exam

CUET

Subject

Economics

Chapter

Micro Economics: Production and Costs

Question:

Which of the following statement (s) is/are correct?

Statement 1: Average and marginal products are often referred to as average and marginal returns, respectively, to the variable input.

Statement 2:Since inputs cannot take negative values, marginal product is undefined at zero level of input employment.

Options:

Only Statement 1 is correct.

Only Statement 2 is correct.

Both statements are correct.

None of the given statement is correct.

Correct Answer:

Both statements are correct.

Explanation:

The correct answer is option 3: Both statements are correct.

Statement 1: Average and marginal products are often referred to as average and marginal returns, respectively, to the variable input. This is correct.

Statement 2:Since inputs cannot take negative values, marginal product is undefined at zero level of input employment. This is correct