Diminishing Returns Occur Because

question 40

Multiple Choice

Diminishing returns occur because

• A)Of inefficiency in the production process.
• B)Of the use of inferior factors of production.
• C)A firm increases the amount of a variable input without changing a fixed input.
• D)Of lower opportunity costs of the factors of production.

Describe how economic incentives and market conditions influence occupational choices.

Recognize the significance of self-employment in wealth accumulation.

Understand the impact of technological improvements on the cost of production and market price.

Analyze the economic effects of reduced production costs on employment and real income.

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Definitions:

Nondiscriminating Monopolist

A monopolist who charges all consumers the same price for a good or service, regardless of the demand or cost conditions.

Demand Schedule

A table that shows the quantity of a good or service demanded at various prices.

Nondiscriminating Monopolist's Demand Curve

The demand curve faced by a monopolist who charges the same price to all customers, reflecting the total market demand for its product.

Average Revenue

Average revenue is the amount of turnover a company generates per unit of product sold, calculated by dividing total revenue by the number of units sold.