Diminishing Returns to Capital Is a Consequence of Firms' Incentives

question 21

Multiple Choice

Diminishing returns to capital is a consequence of firms' incentives to use each piece of capital as productively as possible and illustrates the:

• A)principle of comparative advantage.
• B)principle of increasing opportunity costs.
• C)scarcity principle.
• D)cost-benefit principle.

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Definitions:

Auscultatory Gap

A temporary disappearance of sounds heard over the brachial artery when measuring blood pressure; occurs between the systolic and diastolic pressures.

Systolic Pressure

The maximum arterial pressure during contraction of the heart's left ventricle, commonly the top number in a blood pressure reading.

Diastolic Pressure

The lower measurement of blood pressure, indicating the pressure in the arteries when the heart rests between beats.

Expiration

The expulsion of air from the lungs in breathing.