Assume That There Are Decreasing Returns to Capital, Decreasing Returns

question 15

Multiple Choice

Assume that there are decreasing returns to capital, decreasing returns to labour, and constant returns to scale. Now suppose that both capital and labour increase by 10%. Given this information, we know that output (Y) will:

• A) not change.
• B) increase by 10%.
• C) increase by more than 10%.
• D) increase by less than 20% but more than 10%.
• E) increase by less than 10%.

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Definitions:

IRAC Method

A framework for legal analysis that stands for Issue, Rule, Application, and Conclusion; used to break down legal cases or hypotheticals into manageable segments.

Briefing a Case

The process of summarizing a court case, identifying the main points, legal issues, arguments, and decisions to understand and remember its significance.

Holding

In legal terms, the court's decision or ruling in a case, representing the legal principle or outcome derived from the judgment.

Dicta

Comments, observations, or remarks made by a judge in a legal decision or ruling that are not essential to the resolution of the case.