As a Result of a Fire, a Small Business Owner

question 101

Multiple Choice

As a result of a fire, a small business owner loses some of her computers and other equipment. If the property of diminishing returns applies to all factors of production, she should expect to see

• A)an increase in the marginal productivity of her remaining capital and an increase in the marginal productivity of her labor.
• B)an increase in the marginal productivity of her remaining capital and a decrease in the marginal productivity of her labor.
• C)a decrease in the marginal productivity of her remaining capital and an increase in the marginal productivity of her labor.
• D)a decrease in the marginal productivity of her remaining capital and a decrease in the marginal productivity of her labor.

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Definitions:

Intellectual Abilities

The capacity to engage in abstract thinking, understanding complex ideas, reasoning, and problem-solving, often considered as part of cognitive abilities.

Signal Detection

A technique used to determine the ability to differentiate between information-bearing patterns and random patterns that distract from the information.

Yea-Sayers

Individuals who have a tendency to agree with statements or questions, often affecting the validity of survey or psychological test results.

Naysayers

Individuals who express negativity or skepticism towards ideas, plans, or changes, often discouraging progress.