Economists point out that if it were not for diminishing returns, we could grow enough food to feed the world in a flowerpot. Explain what they mean.
What will be an ideal response?
If diminishing returns did not exist, we could increase food production indefinitely by simply adding more and more inputs (e.g., seed, fertilizer, water) to the flowerpot. However, the reality is that as we add more and more variable inputs to a fixed input (i.e., the flowerpot), marginal returns will eventually begin to decline, thereby limiting food output. To feed the world we must increase the size of the flowerpot.
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When the marginal product of labor exceeds the average product of labor
A) the average product of labor is increasing. B) the average product of labor is decreasing. C) the total product curve is negatively sloped. D) the firm is experiencing decreasing returns to scale.
The owner of a firm wants some advice on how to increase productivity. Suggest three ways the entrepreneur could increase labor productivity through improving technology
What will be an ideal response?
The relationship between the quantity of inputs and the quantity of outputs is called:
A. an input-output function. B. a production function. C. a cost function. D. a resource function.
A fishery collapse occurs when the:
A. Fishery goes out of business B. Fishery is taken over by a government agency C. Fishery's population is harvested at a higher rate than it reproduces D. Fishery's population reproduces at a higher rate than it's harvested