Consider a Firm That Produces Output Using Labor and Capital

question 34

Multiple Choice

Consider a firm that produces output using labor and capital. The firm's stock of capital is fixed and in order to increase output, it must employ more workers. Which of the following occurs as the number of workers increases?

• A) Output per worker rises.
• B) Capital per worker falls.
• C) Wage per worker falls.
• D) Total output increases exponentially.

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Definitions:

Closing Date

The day on which a property sale is concluded, with the transfer of ownership from the seller to the buyer.

Implied Term

A provision in a contract that is not explicitly stated but is assumed to be included to ensure the fair and effective functioning of the contract.

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An inflammation of the larynx, often causing hoarseness or loss of voice, typically resulting from infection or overuse.

Human Rights

The fundamental rights and freedoms that all individuals are entitled to regardless of nationality, sex, national or ethnic origin, race, religion, language, or any other status.