Exhibit 22-8 -Exhibit 22-8 Shows How Output Varies with the Only Variable

question 226

Multiple Choice

Exhibit 22-8

-Exhibit 22-8 shows how output varies with the only variable input used in its production.Marginal physical product of the fifth unit of labor is

• A) 0.
• B) 20.
• C) 50.
• D) 172.

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Definitions:

Relatively Inelastic

Relatively inelastic refers to a situation where the demand for a good or service changes little when its price changes; the percentage change in demand is smaller than the percentage change in price.

Perfectly Elastic

This term describes a situation in market economics where the quantity demanded or supplied responds infinitely to changes in price.

Relatively Elastic

Describes a situation where the quantity demanded or supplied changes significantly in response to a change in price.

Unit Elastic

A demand or supply situation where a percentage change in price leads to an equal percentage change in the quantity demanded or supplied.