The Change in Supply of One Factor

question 150

Multiple Choice

The change in supply of one factor:

• A) will not lower the price of other factors, but may alter their marginal productivity
• B) alters the earnings of all factors
• C) will not alter the marginal productivity of other factors, but may lower their price
• D) will not change the value of marginal product for other factors

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Definitions:

Marginal Product

The additional output produced by using one more unit of a particular input, holding other inputs constant.

Technology Change

The process by which new technologies are developed and introduced, resulting in changes to production processes, products, and industry standards.

Labor Employment

The engagement of workers in the workforce to perform tasks in exchange for wages or salaries.

Marginal Product

The additional output produced as a result of utilizing one more unit of a particular input.