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Worldatwork Exam c8 Topic 4 Question 81 Discussion

Actual exam question for Worldatwork's c8 exam
Question #: 81
Topic #: 4
[All c8 Questions]

What happens to the marginal cost if revenue accelerates slower than variable costs but fixed costs remain the same?

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Suggested Answer: D

by Argelia at Sep 15, 2024, 01:33 AM

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Merri
10 months ago
Haha, this is a classic economics brain-teaser! I'm gonna go with C and say the marginal cost increases at the same rate as those variable costs. Hey, at least it's not as bad as dealing with hyperinflation, right?
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Lorean
9 months ago
Yeah, dealing with hyperinflation would definitely be worse!
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Belen
9 months ago
I'm going with C, it increases at the same rate as variable costs.
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Brandon
10 months ago
I think it remains the same.
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Josefa
10 months ago
Option D makes the most sense to me. As revenues increase, the marginal cost becomes higher and higher. Gotta love those fixed costs, am I right?
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Tonja
10 months ago
I'd go with B. The variable costs are going up, so the marginal cost has to come down. Simple as that.
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Lauran
9 months ago
True, D could be a possibility if revenues are increasing significantly. It's all about the balance between costs and revenue.
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Berry
9 months ago
But wouldn't it also depend on how much revenue is increasing? Maybe D could be a possibility too.
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Sherell
10 months ago
I agree, B makes sense. Variable costs going up means marginal cost should decrease.
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Anthony
11 months ago
Hmm, if revenue is accelerating slower than variable costs, that's gotta mean the marginal cost is gonna decrease. It's basic economics, folks!
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Chau
10 months ago
Exactly, it's all about that balance between revenue and costs.
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Georgiann
10 months ago
But fixed costs remain the same, so the marginal cost will decrease.
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Lucy
10 months ago
So, in this scenario, the marginal cost would likely remain the same.
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Laura
10 months ago
That's a good point, fixed costs do have an impact on the overall marginal cost.
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Shenika
10 months ago
A) It decreases because variable costs are increasing.
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Lyla
10 months ago
But wouldn't fixed costs remaining the same also play a role in keeping the marginal cost steady?
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Chanel
11 months ago
I think the marginal cost would decrease because revenue is not increasing as fast as variable costs.
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Jamal
11 months ago
But if revenue accelerates slower than variable costs, wouldn't that lead to a decrease in marginal cost?
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Chau
11 months ago
I disagree, I believe the answer is A) It remains the same.
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Jamal
11 months ago
I think the answer is B) It decreases because variable costs are increasing.
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