-The Increase in the Demand for Widgets, Shown in the Figure

question 511

Multiple Choice

-The increase in the demand for widgets, shown in the figure above, is the result of a decrease in the price of McBoover devices. Therefore

• A) widgets and McBoover devices are substitutes.
• B) widgets and McBoover devices are complements.
• C) widgets are a normal good.
• D) McBoover devices are a normal good.

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Definitions:

First Worker

The initial employee hired in a startup or new business venture, often taking on multiple roles and responsibilities.

Marginal Product

The extra production achievable by incorporating an additional unit of a particular input, assuming all other variables remain constant.

Average Product

The output per unit of input, calculated by dividing total output by total input.

Diminishing Marginal Returns

Diminishing Marginal Returns is an economic principle stating that as additional units of a factor of production are added to a fixed amount of other factors, the incremental increase in output will eventually decrease.