Examlex

Solved

Suppose That When the Price of Hamburgers Decreases, the Ruiz

question 219

Multiple Choice

Suppose that when the price of hamburgers decreases, the Ruiz family increases their purchases of ketchup.To the Ruiz family,


Definitions:

Marginal Product

The extra production generated when one more unit of a particular input is added, with all other inputs remaining unchanged.

Law of Diminishing Returns

An economic principle stating that as investment in a particular area increases, the rate of profit from that investment, after a certain point, cannot continue to increase if other variables remain constant.

Extra Output

The additional production that is generated as a result of adding more of a variable input, such as labor or capital.

Diminishing Returns

A principle stating that as additional amounts of a variable input are added to a fixed input, beyond some point the marginal product of the variable input begins to decrease.

Related Questions