The Law Stating That If the Quantity of a Variable

question 136

Multiple Choice

The law stating that if the quantity of a variable factor of production is increased, with the quantities of all other factors given, the marginal product of the variable factor will eventually decline is the law of:

• A) demand.
• B) supply.
• C) decreasing average production.
• D) diminishing marginal returns.

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Definitions:

Capital Account Balance

A measure within a country's balance of payments that records all transactions involving the acquisition or disposal of capital assets, such as securities and real estate, between residents and nonresidents.

Legal Tender

Coins and paper money officially declared to be acceptable for the settlement of financial debts.

Car Importer

A company or individual that buys foreign cars and brings them into a country to sell.

Drug Trafficking

The illegal trade involving the cultivation, manufacture, distribution, and sale of substances which are subject to drug prohibition laws.