Are increasing cost industries a result of the law of diminishing marginal returns?
What will be an ideal response?
No, the law of diminishing marginal returns cause increasing costs in the short run, when at least one input is fixed. Increasing cost industries have higher long run marginal costs for other reasons, such as having limited inputs and firms have varying technologies.
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Because the height of the demand curve measures the marginal value of the good to consumers, the fact that a demand curve slopes downward to the right illustrates that
a. as more of a product is consumed, consumers will value additional units less. b. as more of a product is consumed, consumers will value additional units more. c. the value of additional units of the good is unrelated to the amount consumed. d. the cost of production for a good generally rises as more of it is produced.
The poverty rate for female households with no spouse present is approximately
a. 10 percent. b. 20 percent. c. 30 percent. d. 40 percent.
The marginal rate of technical substitution at any particular labor-capital bundle is
A. the wage relative to the cost of capital. B. the ratio of labor to capital. C. the slope of the isoquant. D. the slope of the indifference curve. E. the average product of labor relative to the average product of capital.
The Robinson-Patman Act of 1936:
A. prohibited selling products at "unreasonably low prices" with the intent of reducing competition. B. made it illegal to monopolize a market. C. repealed the Sherman Act. D. outlawed price discrimination for the purpose of reducing competition.