When Additions of Input to a Fixed Quantity of Another

question 46

Multiple Choice

When additions of input to a fixed quantity of another input lead to progressively smaller increases in output,we say we are facing

• A)diminishing returns.
• B)negative returns.
• C)accelerating returns.
• D)decreasing production.

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Definitions:

Vertical Axis

In a graph or chart, the y-axis along which numerical data, typically representing a variable being measured, is plotted.

Budget Line

A graphical representation of all possible combinations of two goods which a consumer can purchase with a given budget, at fixed prices for those goods.

Prices Rise

A situation where the general level of prices for goods and services increases over a period of time, reducing purchasing power, often referred to as inflation.

Budget Line

An illustrated diagram detailing every possible pairing of two products affordable within a set budget at constant prices.