The Production Possibilities Frontier Will Not Be Convex to the Origin

question 68

Multiple Choice

The production possibilities frontier will not be convex to the origin if:

• A)all firms experience constant returns to scale.
• B)the law of diminishing returns is universally satisfactory.
• C)at least some firms experience increasing returns to scale.
• D)no firms experience decreasing returns to scale.

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Definitions:

Covariation Model

Kelley’s theory of causal attribution – people assign the cause of behaviour to the factor that covaries most closely with the behaviour.

Emotional Lability

The propensity for rapid, often unpredictable changes in emotion.

Correspondent Inference

A theory suggesting that people infer the motives and dispositions of others from observable behaviors, especially if the behaviors are unexpected.

Causal Inference

The process of determining the cause-and-effect relationship between variables, typically assessed through controlled experiments or observational studies.