Marginal Physical Product Diminishes as Additional Workers Are Hired Because

question 31

Multiple Choice

Marginal physical product diminishes as additional workers are hired because

• A)Each worker has an increasingly smaller amount of other factors with which to work.
• B)Each worker has an increasingly larger amount of other factors with which to work.
• C)Later hires are not as skilled as earlier hires.

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Definitions:

Fixed Component

A portion of a cost that remains constant regardless of the level of production or sales volume, such as rent, salaries, and insurance.

Mixed Cost

A cost composed of a fixed and variable component, changing with the level of activity but also containing a constant element.

Escrows Completed

Typically, the term "escrow" refers to a financial arrangement where a third party holds and regulates the payment of funds required for two parties involved in a given transaction. "Escrows Completed" could refer to transactions that have successfully met their conditions and been finalized, although this is not a standard accounting or financial term.

Variable Cost

Costs that vary directly with the level of production or output.