Suppose 30 Employee-Hours Can Produce 50 Units of Output

question 112

Multiple Choice

Suppose 30 employee-hours can produce 50 units of output.If the law of diminishing marginal returns is present,producing 100 units of output will require

• A) an additional 30 employee-hours.
• B) more than 30 additional employee-hours.
• C) a total of 60 or less employee-hours.
• D) fewer than 30 additional employee-hours.
• E) a total of 90 or more employee-hours.

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Definitions:

Market Risk Premium

The extra earnings an investor foresees from holding a risky market portfolio in comparison to risk-free assets.

Risk-Free Rate

The theoretical return on investment with no risk of financial loss, typically represented by the yield on government bonds like U.S. Treasury securities.

Semistrong Efficient

A form of market efficiency that states all public information is already calculated into stock prices, and thus, no one can achieve higher returns by trading on that information.

Expected Returns

The anticipated return on an investment, taking into account all known risks and rewards associated with it.