Which of the following contributes to increasing marginal returns?
A) decreasing implicit costs
B) increasing explicit costs
C) specialization of labor
D) Both answers A and B are correct.
E) Both answers A and C are correct.
C
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What are two ways the government can use to maintain full employment in an open economy? Also give an example for each
What will be an ideal response?
An economy that is operating below its full-employment capacity is experiencing:
a. Say's Law. b. unrealizable inflationary expectations. c. Keynesian aggregate demand. d. an inflationary gap. e. a recessionary gap.
As the price of a good increases:
a. that good will yield less satisfaction per dollar than before. b. consumers will have more real income to spend on other goods. c. the quantity demanded of that good will also increase. d. the utility-maximizing quantity of that good willl not change. e. consumers will buy the good and substitute away from other goods.
The suggestion that people are "satisficers" is similar to the view that people
a. are wealth-maximizers. b. exhibit "bounded rationality." c. go to a lot of trouble to weigh costs and benefits before choosing a course of action. d. change their minds often.