Which of the Following Explains Most Accurately Why the Firm's

question 179

Multiple Choice

Which of the following explains most accurately why the firm's short-run marginal cost curve will eventually rise?

• A) As more of the variable factor is used, its price will rise.
• B) When diminishing marginal returns set in, it will take ever-larger quantities of the variable resources to produce an additional unit of output.
• C) As the variable factor is used more intensely, its marginal product will rise, causing an increase in marginal costs.
• D) As the size of the firm increases, the operational efficiency of the firm declines, causing an increase in marginal costs.

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Definitions:

Individualism

A social theory favoring freedom of action for individuals over collective or state control.

CIO

An abbreviation for the Congress of Industrial Organizations, a federation of unions that organized workers in industrial unions in the United States and Canada from 1935 to 1955.

Communist Members

Individuals who are part of a political party or movement advocating for communism, a system where property is owned by the community and each person contributes and receives according to their ability and needs.

Red Scare

A term describing the fear and persecution of presumed communists and radical leftists, especially in the United States during the early 20th century, notably in the 1920s and again in the 1950s.