As a Result of Doubling All Its Inputs, If a Firm

question 39

Multiple Choice

As a result of doubling all its inputs, if a firm can more than double its output, its production function exhibits

• A) Constant returns to scale.
• B) Increasing returns to scale.
• C) Decreasing returns to scale.
• D) Increasing marginal productivity to at least one input.

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Definitions:

Net Income

The total profit or loss of a company after all revenues, expenses, taxes, and costs have been subtracted.

Financial Statements

Reports that summarize the financial performance and position of a business, including the balance sheet, income statement, and cash flow statement.

Accrued Revenues

Revenues earned but not yet received in cash or recorded at the statement date, often recognizing revenue before the payment is received.

Financial Statements

Financial Statements are formal records of the financial activities and position of a business, person, or other entity, presented in a structured manner.