Examlex
An investor has expectations of a $4 dividend next year with future dividends growing at 6% in perpetuity. If the investor is willing to pay $80 for the stock, the investor's expected return is 11%.
Production Function
A mathematical model describing the relation between input quantities and their respective outputs.
Marginal Products
A new definition for the additional units of output gained by employing one more unit of a specific input, keeping all other inputs constant.
Law of Diminishing Returns
An economic principle stating that as investment in a particular area increases, the rate of profit from that investment, after a certain point, cannot continue to increase if other inputs remain the same.
Average Product
The output per unit of input, calculated by dividing total product by the quantity of input.
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