What happens to the marginal product of additional cooks in a restaurant kitchen as more cooks are hired?
A. Marginal product will stay constant
B. Marginal product will rise because each additional cook contributes to the production process
C. Marginal product will eventually fall because the cooks will get in each other's way, reducing productivity
D. We cannot know because marginal product depends entirely on the skills of the individual cooks
Answer: C
You might also like to view...
If $30 billion in new investment is added to the economy and MPC is 0.9, national income would increase by
a. $30 billion b. $90 billion c. $100 billion d. $210 billion e. $300 billion
According to classical macroeconomic theory, changes in the money supply change real GDP but not the price level
a. True b. False Indicate whether the statement is true or false
Because the price level does not affect the long-run determinants of real GDP, the long-run aggregate-supply is vertical
a. True b. False Indicate whether the statement is true or false
Refer to the information provided in Figure 32.2 below to answer the question(s) that follow.
Figure 32.2Refer to Figure 32.2. According to the monetarists, a recession can be caused when
A. AS1 shifts to the left. B. AD1 shifts to the left. C. LRAS shifts to the left. D. AD1 shifts to the right.