When Planned Expenditure Is Drawn on a Graph as a Function

question 1

Multiple Choice

When planned expenditure is drawn on a graph as a function of income, the slope of the line is:

• A)between minus one and zero.
• B)between zero and one.
• C)one.
• D)greater than one.

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Definitions:

Marginal Revenue Product

The boost in revenue achieved by adding one more unit of a factor involved in production.

Marginal Product

The additional output that results from using one more unit of a particular input, keeping other inputs constant.

Variable Input

Any resource used in production whose quantity can be changed in the short term to increase or decrease output.

Marginal Revenue Product Curve

A graphical representation showing how the additional revenue generated by employing one more unit of a resource varies with the quantity of the resource employed.