Question

Given below are two statements:
Statement (I): Linear programming and budgeting have certain features in common, however, the former is a much more refined tool.
Statement (II): AVC per unit of output reaches a maximum at that level of output where APP is also at its maximum.
In light of the above statements, choose the most appropriate answer from the options given below.

• A. Both Statement (I) and Statement (II) are true.
• B. Both Statement (I) and Statement (II) are false.
• C. Statement (I) is true but Statement (II) is false.
• D. Statement (I) is false but Statement (II) is true.

Hint:

Remember the inverse relationship between cost and productivity:
- Maximum \(\text{APP}\) corresponds to Minimum \(\text{AVC}\).
- Maximum \(\text{MPP}\) corresponds to Minimum \(\text{MC}\).

Answer 1

The Correct Option is C