The best explanation for the shape of a short run marginal cost schedule is
A. there is no fixed factor of production.
B. increasing returns to scale.
C. decreasing returns to scale.
D. a fixed factor causes diminishing returns to other factors.
Answer: D
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Suppose Christina just saw an advertisement on television for an antidepressant, but it has been a long time since James saw one. According to the availability heuristic:
A. Christina and James are likely to think that depression is equally common. B. Christina is likely to think that depression is more common than James. C. James is likely to think that depression is more common than Christina. D. Christina and James are equally likely to think that people recover from depression.
In 1968, the government instituted a 26 percent income tax surcharge. In terms of the AS/AD model, this change should have:
A. shifted the AD curve to the right. B. shifted the AD curve to the left. C. made the AD curve steeper. D. made the AD curve flatter.
In October 2008, __________ percent of the unemployed workers in the United States were collecting unemployment benefits.
A. 32 B. 38 C. 46 D. 64
When the going rate is $10.00 per hour, Ann wants to babysit 6 hours each week and Pat wants to babysit 4 hours each week. If the rate goes up to $12.00, Ann and Pat both double the number of hours they are willing to babysit each week. Based on this information, a combined supply curve will pass through the points:
A. price = $10.00, quantity supplied = 6 and price = $12.00, quantity supplied = 4. B. price = $10.00, quantity supplied = 10 and price = $12.00, quantity supplied = 20. C. price = $10.00, quantity supplied = 20 and price = $12.00, quantity supplied = 10. D. price = $10.00, quantity supplied = 4 and price = $12.00, quantity supplied = 6.