Decreasing returns to scale
A) indicate that an increase in all inputs by some proportion will result in a decrease in output.
B) must always occur at some point in the production process.
C) are directly related to the law of diminishing returns.
D) All of the above are true.
E) None of the above is true.
E
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Refer to Figure 9.3. The firm's profit it represented by what area?
A. AHID
B. ABCD
C. DCK0
D. EFG0
When comparing short-run average total cost with long-run average total cost at a given level of output,
a. short-run average total cost is typically above long-run average total cost. b. short-run average total cost is typically the same as long-run average total cost. c. short-run average total cost is typically below long-run average total cost. d. the relationship between short-run and long-run average total cost follows no clear pattern.
Banks act as an intermediary between savers and borrowers by determining the:
A. quantity of funds that will be saved depending on the price. B. quantity of funds that will be borrowed, for any given quantity of savings. C. price at which the quantity of funds saved will be equal to the quantity invested. D. price at which the quantity of funds saved will be more than enough for those who want to borrow.
A situation in which a benefit or a cost associated with an economic activity spills over to third parties is called
A) a public good. B) a merit good. C) an externality. D) the free-rider problem.