Diminishing marginal returns implies that firms:
A. require fewer and fewer workers to produce each additional unit of output.
B. require more and more workers to produce each additional unit of output.
C. get decreasing amounts of revenue for each unit of output they produce.
D. get increasing amounts of revenue for each unit of output they produce.
Answer: B
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A) right; right B) right; left C) left; right D) left; left
To solve the common pool problem in fishing, governments can __________, or __________
a. impose a depletion tax; prohibit resource use entirely b. impose a depletion tax; restrict output c. introduce an offsetting positive externality; prohibit resource use entirely d. use a variable technology; impose a depletion tax e. restrict output; prohibit resource use entirely
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