If a Firm Develops Better Methods of Producing a Product

question 86

Multiple Choice

If a firm develops better methods of producing a product, then this process innovation can be expected to result in a(n)

• A) upward shift in both the total product and average cost curves.
• B) downward shift in both the total product and average cost curves.
• C) downward shift in the total product curve and an upward shift in the average cost curve.
• D) upward shift in the total product curve and a downward shift in the average cost curve.

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Definitions:

Primary Reinforcer

An innately satisfying stimulus, such as food or warmth, that does not require any learning to become desirable.

Salient

Referring to something that is prominent, significant, or conspicuous in a particular context.

Extinction

In behavioral psychology, the gradual weakening and eventual disappearance of a conditioned response when the reinforcement is no longer offered.

Punishment

A consequence applied to decrease or eliminate an unwanted behavior, typically involving either physical or psychological discomfort.