If Output Is Produced with Two Factors of Production and with Increasing

question 30

Multiple Choice

If output is produced with two factors of production and with increasing returns to scale,

• A)there cannot be diminishing marginal rate of substitution.
• B)all inputs must have increasing marginal products.
• C)on a graph of production isoquants, moving along a ray from the origin, output more than doubles as the distance from the origin doubles.
• D)the marginal product of at least one input must be increasing.
• E)all inputs must have decreasing marginal products.

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Definitions:

Mid-Twentieth Century

A period spanning the middle decades of the 20th century, often characterized by significant social, political, and technological changes.

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Products that have sufficient demand and appeal in the market to be sold profitably.

Sales Orientation

A business approach that prioritizes the selling of products and services over understanding the needs and preferences of the consumer, focusing on sales volume.

Marketing Concept

A philosophy that firms should analyze the needs of their customers and then make decisions to satisfy those needs, better than the competition.