Question

When Price Falls With Rise in Output, Then?

• A. AR curve is steeper than MR curve
• B. TR increases
• C. MR curve is steeper than AR curve
• D. AR and MR Curves coincide in a horizontal line parallel to X axis

Answer 1

The correct option is C

MR curve is steeper than AR curve

Answer:

(C) MR curve is steeper than the AR curve

Both MR and AR curves fall with an increase in output, but the MR curve is steeper than the AR curve as the MR curve is derived from a single unit while the AR curve is derived from all the units.

Also read:

• Total Product Average Product and Marginal Product
• Meaning of Demand and Factors Affecting Demand
• Law of Variable Proportion
• The Law of Diminishing Marginal Product and the Law of Variable Proportions

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