Thelma owns and operates a small lemonade stand. When Thelma is producing a small quantity of lemonade, she has few workers and her equipment is NOT being fully utilized. If she can easily put her idle resources to use, what will happen to the costs of production?

Question

Answer

The average variable cost of an extra worker will increase.

Answer

None of the above.

Answer

The marginal cost of one more glass of lemonade is small.

Answer

The marginal cost of an extra worker is large.

Answer

The average variable cost of an extra worker will decrease.

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Thelma owns and operates a small lemonade stand. When Thelma is producing a smal...

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