Use the Following to Answer Questions

question 46

Multiple Choice

Use the following to answer questions .
Exhibit: Aggregate Production Function
-(Exhibit: Aggregate Production Function) The production function displays

• A) increasing marginal returns to labor.
• B) constant marginal returns to labor.
• C) increasing marginal returns to labor initially followed by diminishing marginal returns.
• D) diminishing marginal returns to labor.

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Definitions:

Deadweight Loss

A loss of economic efficiency that can occur when the equilibrium for a good or service is not achieved or is unattainable.

Units Bought

Refers to the quantity of a particular good or service purchased by consumers or businesses.

Tax Imposed

A financial charge or other levy placed upon an individual or a legal entity by a state or a functional equivalent of a state.

Consumer Surplus

The difference between the amount consumers are willing to pay for a good or service versus what they actually pay.