If a Production Function Is Expressed in a Linear Form

question 49

Multiple Choice

If a production function is expressed in a linear form, the inputs used in the production process:

• A) are perfect complements.
• B) are perfect substitutes.
• C) have to be increased in the same proportion.
• D) have fixed marginal costs.
• E) have equal marginal productivity.

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Definitions:

Quantity Demanded

The total amount of a good or service that consumers are willing to purchase at a given price level in a given time period.

Demand

The desire to purchase goods and services backed by the ability and willingness to pay at a given price.

Demand Curve

A graphical representation showing the relationship between the price of a product and the quantity of the product demanded at those prices.

Increase in Demand

Refers to a rise in the quantity of a product or service that consumers are willing and able to purchase at various prices, often due to factors like income increases, taste preferences, or changes in population.