Based on the Table Below and the Principle of Diminishing

question 80

Multiple Choice

Based on the table below and the principle of diminishing returns to capital, then total packages wrapped when a fourth machine is installed must be less than ______ packages. $$\begin{array} { | c | c | } \hline \text { Number of (Identical) Machines } & \text { Total Packages Wrapped } \\\hline 1 & 10,000 \\\hline 2 & 13,000 \\\hline 3 & 15,000 \\\hline\end{array}$$

• A) 2,000
• B) 15,000
• C) 16,000
• D) 17,000

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Definitions:

Elasticity

An economic measure of the responsiveness of the quantity demanded or supplied of a good or service to changes in its price or consumer income.

Unit Wages

The cost of labor per unit of output, measuring how much is paid in wages for the production of one unit of a good or service.

Employed Workers

Individuals actively engaged in a job or business who are receiving compensation for their labor.

Price Elasticity

The measure of how much the quantity demanded of a good responds to a change in the price of that good.