Which of the Following Is an Example of a Simple

question 54

Multiple Choice

Which of the following is an example of a simple bounds constraint?

• A) confirming that production does not go beyond a certain unit value
• B) reducing production due to scarcity of resources
• C) meeting targets for a specific sales job
• D) equaling production in September with the resources available at the end of August

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Definitions:

Diminishing Marginal Returns

A principle that states as additional units of a variable input are added to fixed inputs, the additional output produced from each new unit eventually decreases.

Variable Resources

Inputs that change in quantity with levels of production, such as raw materials and labor.

Variable Cost

Costs that change in proportion to the level of goods or services that a business produces.

ATC

Average Total Cost, which is the sum of all production costs divided by the quantity of output produced.