If the First Worker Produces Ten Custom Picture Frames a Day

question 114

True/False

If the first worker produces ten custom picture frames a day, and the second worker produces twelve additional custom picture frames a day, then diminishing marginal returns have not yet set in.

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Definitions:

Short-run Phillips Curve

A graphical representation showing an inverse relationship between the rate of unemployment and the rate of inflation in the short-term.

Unemployment

The situation in which people who are willing and able to work are not able to find employment, often expressed as a percentage of the labor force.

Aggregate-supply Curve

A graph that shows the relationship between the overall price level and the total output produced by firms in an economy.

Production Costs

The expenses incurred in the process of creating a product or service, including labor, materials, and overhead costs.