In Order to Increase the Ratio of Outputs to Inputs,a

question 30

Multiple Choice

In order to increase the ratio of outputs to inputs,a manager would have to ________.

• A)decrease the selling price
• B)increase productivity
• C)increase the quality of inputs
• D)hire additional employees

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Definitions:

Marginal Cost

The addition to total cost that results from producing one more unit of output.

Diseconomies of Scale

The condition in which a company's costs per unit increase as it produces more units, typically due to inefficiencies that arise with increased size or output.

Diminishing Marginal Returns

A principle stating that as additional units of a variable input are added to a fixed input, the additions to output will eventually decrease.

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.