If All Resources Used in the Production of a Product

question 296

Multiple Choice

If all resources used in the production of a product are increased by 20 percent and output increases by 20 percent, then there must be

• A)economies of scale.
• B)diseconomies of scale.
• C)constant returns to scale.
• D)increasing average total costs.

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Definitions:

Exaggerate Differences

The act of making distinctions between entities more pronounced or significant than they actually are.

Cognitive Dissonance

A psychological phenomenon where an individual experiences discomfort from holding two or more conflicting beliefs, ideas, or values at the same time.

Cognitions

Mental processes involved in gaining knowledge and comprehension, including thinking, knowing, remembering, judging, and problem-solving.

Culture

The shared beliefs, customs, practices, and social behavior of a particular nation or people.