Returns to Specialization Can Occur When

question 35

Multiple Choice

Returns to specialization can occur when

• A)increasing the amount of labor allows workers to specialize.
• B)the exponents of the Cobb-Douglas production function are greater than 1.
• C)a firm doubles its inputs.
• D)the average cost curve is above the marginal costs curve.

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Definitions:

Net Income

The total earnings of a company after all expenses and taxes have been deducted from total revenue, representing the company's profit.

Dividends Paid

The sum of money paid by a company to its shareholders out of its profits or reserves.

Cash Flow

The aggregate circulation of cash and cash-like resources transitioning into and out of an enterprise.

Creditors

Individuals, banks, or other entities that lend money or extend credit to others, with the expectation of being repaid, often with interest.