Why Does the Law of Diminishing Return Not Apply in the Long

question 22

Multiple Choice

Why does the law of diminishing return not apply in the long run?

• A)All the factors of production are fixed
• B)There are no fixed factors of production
• C)There are some fixed and some variable factors
• D)The producer is required to produce a fixed level of output
• E)The producer can change the level of output only by changing the variable factors,fixed factors remaining unchanged

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Definitions:

Facility Expenses

Costs associated with the physical locations, such as rent, utilities, and maintenance, where a business operates.

Planning Budget

A budget created at the beginning of the budgeting period that is based on planned outputs and efficiency levels for that period.

Tenant-Days

A measurement used in the real estate and hospitality industry, representing the total number of days that all tenants or guests have occupied a space over a given period.

Tenant-Days

A measure used in property management to calculate the total number of days rental units were occupied over a specific period.