If Capital Is a Variable Input in Production, the Law

question 203

Multiple Choice

If capital is a variable input in production, the law of diminishing marginal returns implies that in the short run

• A) capitalʹs marginal product is constant.
• B) capitalʹs marginal product decreases after a certain point.
• C) total product is negative.
• D) total product is negative after a certain point has been reached.

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Definitions:

Financial Advantage

The benefit or edge gained by managing financial resources effectively, often leading to increased profits or reduced costs.

Fixed Expenses

Costs that do not change with the level of production or sales, such as rent, salaries, and insurance.

Beet Juice

A liquid extracted from beets, known for its nutritional benefits and potential use in food coloring and health drinks.

Refined Sugar

Sugar that has been processed to remove impurities and is typically found in a granulated form suitable for consumption.