If Equal Amounts of a Variable Input Are Sequentially Added

question 30

Multiple Choice

If equal amounts of a variable input are sequentially added to the fixed input in a typical production function,

• A)The increments to output will decrease first and then increase
• B)The additions to output will be constant
• C)Increments to output will increase indefinitely
• D)Increments to output will first increase at an increasing rate and then at a decreasing rate

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Definitions:

Capital Intensive

A term used to describe businesses or industries that require substantial amounts of capital investment in machinery, equipment, or other physical assets to produce goods or services.

GDP Per Capita

The gross domestic product divided by the population, serving as an indicator of a country's economic performance and standard of living.

Developing Countries

Nations with lower levels of industrialization, income, and quality of life, often characterized by efforts towards economic development.