Question: Explain the relationship between a firm's short-run production function and its short-run cost function. Focus on the marginal product of an input and the marginal

  1. Explain the relationship between a firm's short-run production function and its short-run cost function. Focus on the marginal product of an input and the marginal cost of production.
  2. "If it were not for the law of diminishing returns, a firm's average cost and average variable cost would not increase in the short run." Do you agree with this statement? Explain.
  3. Explain the distinction made in economic analysis between the short run and the long run.
  4. Define economies of scale. How does this relate to returns to scale? Cite and briefly discuss the main determinants of economies of scale.
  5. Define diseconomies of scale. Cite and briefly discuss the main determinants of this phenomenon.
  6. Define economies of scope. Is this concept related to economies of scale? Explain.

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