Diminishing Returns to a Factor Implies That with Capital Fixed

question 24

Multiple Choice

Diminishing returns to a factor implies that with capital fixed,

• A) as labor increases output always increases.
• B) as output increases, labor increases.
• C) as labor increases, output decreases.
• D) as labor increases, labor productivity eventually decreases.

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Definitions:

Activity-Based Costing

An accounting method that assigns costs to products and services based on the activities and resources that go into producing them.

Time-Driven

refers to a methodology where tasks or processes are estimated and evaluated based on the time they take to complete.

Activity-Based Costing

A pricing strategy that recognizes activities conducted in a company and apportions the cost of each activity across all services and products, reflecting their real consumption.

Receiving Calls

The process of answering incoming telephone calls, often associated with customer service or technical support departments.