The Ratio of a Firm's Monthly Output to the Number

question 70

Multiple Choice

The ratio of a firm's monthly output to the number of labour hours used in the same month would be a measure of

• A) labour productivity.
• B) capital productivity.
• C) machine productivity.
• D) multifactor productivity.

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Definitions:

Marginal Cost

The extra financial burden of manufacturing one more unit of a product or service.

Natural Monopolies

A situation where a single firm can supply a product or service to an entire market at a lower cost than two or more firms, making competition impractical.

Diseconomies of Scale

A situation in which a company or business grows so large that the costs per unit increase.

Long-run ATC

Long-run Average Total Cost refers to the per-unit cost of production in the long term where all inputs are considered variable.