In order for the law of diminishing returns to be present, we must have
a. at least one factor of production to be fixed.
b. output decreasing as more laborers are hired.
c. the price of labor increasing as more workers are hired.
d. simultaneous changes in labor and capital.
e. double the output when labor input is doubled.
A
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Which of the following ia a belief of classical theory?
a. Long-run full employment. b. Inflexible wages. c. Inflexible prices. d. All of these.
Without trade, a country's consumption possibilities are
A. Greater than with trade. B. More than its terms of trade. C. Limited to its domestic production possibilities. D. Less than its trade balance.
The oligopoly model in which each firm assumes that rivals will continue to produce at their current output levels is called the:
A. Chamberlin model B. Bertrand model C. Cournot model D. Stackelberg model
An increase in the unemployment rate would affect tax receipts and government expenditures by
A. reducing tax receipts and expenditures. B. increasing tax receipts and expenditures. C. reducing tax receipts and raising expenditures. D. raising tax receipts and reducing expenditures.