The situation in which the marginal product of labor is greater than zero and declining as more labor is hired is called the law of:
a. diminishing returns.
b. negative response.
c. inverse return to labor.
d. demand.
a
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Demand-pull inflation starts with a shift of the
A) potential GDP line leftward. B) AD curve leftward. C) AS curve leftward. D) AS curve rightward. E) AD curve rightward.
Differences in marginal revenue products are the most important factor in explaining wage differences. Other factors that explain wage differences include all but one of the following. Which factor does not help explain differences in wages?
A) discrimination B) labor unions C) compensating differentials D) cognitive differentials
An increasing-cost industry is so named because of the positive slope of which curve?
A) Each firm's short-run average cost curve B) Each firm's short-run marginal cost curve C) Each firm's long-run average cost curve D) Each firm's long-run marginal cost curve E) The industry's long-run supply curve
International trade occurs whenever
a. two nations have achieved internal economic efficiency b. one of the trading nations is self-sufficient c. one nation can profit from trade at the expense of another d. two nations can benefit from trading with each other e. labor is cheaper in one country than in another