The observation that beyond some point, successive increases in a variable factor of production added to a fixed factor of production lead to smaller and smaller increases in output is
A. the law of diminishing marginal product.
B. the law of averages.
C. the law of opportunity costs.
D. the law of marginal utility.
Answer: A
You might also like to view...
In an economy, unemployment exists only at points that are on the interior of the production possibilities frontier.
Answer the following statement true (T) or false (F)
Economist A.C. Pigou argued that to deal with a negative externality in production, the government should impose a tax equal to the cost of the externality
What did Pigou believe should be done in the case of a positive externality in consumption? How would his recommendation impact the demand and market equilibrium for the product which is generating the positive externality?
Piecework compensation plans are useful when productivity is difficult to measure
Indicate whether the statement is true or false
In the classical model, beginning from an equilibrium in which the government is running a budget surplus,
a. this will lower the wage rate b. the demand for loanable funds will be horizontal c. an increase in government spending will crowd out more than an equal amount of private spending d. an increase in government spending will crowd out an equal amount of private spending e. an increase in government spending will crowd out less than an equal amount of private spending