Which of the Following Is True About the Factors of Production

question 30

Multiple Choice

Which of the following is true about the factors of production?

• A) The factors of production as well as technology determine the physical limits to production.
• B) Rich countries have an unlimited quantity of factors.
• C) The factors include natural resources but not skilled labor.
• D) Some factors are scarce but other factors are not.

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Definitions:

Long-run ATC

Referring to the average total cost of production when all inputs, including capital, are variable over a longer period.

Average Fixed Costs

When the production expenses that stay uniform, regardless of production levels, are divided by the number of goods produced.

Average Total Cost

The total cost of production divided by the total quantity of goods or services produced, representing the average cost per unit of output.

Plant Size

The capacity or physical dimensions of a manufacturing or production facility, influencing its output and scale of operations.