Let L represent the quantity of labor, and let Q represent the quantity of output. Suppose a certain production function includes the points (L = 7, Q = 27), (L = 8, Q = 35), and (L = 9, Q = 45). Based on these three points, this production function exhibits diminishing marginal product
a. True
b. False
Indicate whether the statement is true or false
False
You might also like to view...
Refer to the scenario above. Which of the following problems is most likely to arise in this case?
A) Adverse selection B) Moral hazard C) The tragedy of the commons D) The free-rider problem
How is the efficient quantity of public goods determined?
What will be an ideal response?
Some environmental groups are on record suggesting that the price of gasoline should be much higher than it was in the early 1990s. Why might they say this?
A) They own stock in oil companies. B) They anticipate that the longer the price is high, the more elastic the response by consumers will be. C) They anticipate that the longer the price is high, the less elastic the response by consumers will be. D) They anticipate that higher prices will reduce the price elasticity of supply of oil.
Suppose that a regulated industry experiences an increase in the price of inputs used to produce the good. Which of the following statements is TRUE?
A) Under both the capture theory and the share-the-gains, share-the-pain theory profits will decrease. B) An increase in price will occur quicker in the share-the gains, share-the-pain theory than the capture theory. C) An increase in price will occur quicker in the capture theory than the share-the-gains, share-the-pain theory. D) In the capture theory there will be an increase in price but not in the share-the-gains, share-the-pain theory.