Which of the following are correct?
(A) Average Product of labor = Total Product of labor / Labor.
(B) Average cost = average variable cost + average fixed cost.
(C) Marginal Product of labor = Total Product of labor/Labor.
(D) Average fixed cost = Fixed cost/Output.
Choose the correct answer from the options given below:
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → (A), (B) and (D) only
(A) Average Product of labor = Total Product of labor / Labor. True.
(B) Average cost = average variable cost + average fixed cost. True.
(C) Marginal Product of labor = Total Product of labor/Labor. False. Marginal Product (MP) is the change in total product due to one additional unit of labour, not the ratio of total product to labour
(D) Average fixed cost = Fixed cost/Output. True.