If the Price of an Input Falls,a Firm Would Increase

question 3

Multiple Choice

If the price of an input falls,a firm would increase the use of that input for two reasons:

• A)the input is now more productive,and the firm can substitute this input for other relatively more expensive inputs.
• B)the input is now more productive,and overall production costs are now lower,meaning a firm may choose to increase production.
• C)overall production costs are now lower and the firm can substitute this input for other relatively more expensive inputs.
• D)overall production costs are now lower and the firm will have more of other inputs to use with the one in question.

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Definitions:

Settlement

An agreement reached between parties in a dispute, typically without admission of guilt or fault, to resolve the matter without further legal action.

Debt

Money owed by one party to another under the condition that it will be paid back, often with interest.

Statute Law

Written laws enacted by a legislative body, governing various aspects of societal conduct.

Lesser Sum

Refers to an amount of money that is smaller in comparison to another figure or expectation.