Which of the Following Statements Is True

question 112

Multiple Choice

Which of the following statements is true?

• A) Due to fixed resources, an additional unit of labour always adds more to production.
• B) The marginal product of labour always increases when an additional unit of labour is employed.
• C) Diminishing returns is a rare situation that occurs only when all inputs are not fixed.
• D) The law of diminishing returns indicates that addition of an extra unit of a variable factor will decrease the marginal product.

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Definitions:

Inferior Goods

Products whose demand decreases as consumer income rises, opposite to what is observed with normal goods.

Substantial Performance

A legal concept indicating that a party has fulfilled enough of its contractual obligations to warrant payment, even if some minor specifications are not met.

Doctrine

A doctrine is a set of principles or beliefs, especially in legal contexts, establishing a particular rule of law or policy guidance.

Good Faith

The principle of honesty and sincerity in dealings and transactions, free of intent to deceive or defraud.