Diminishing Marginal Returns Occur When

question 39

Multiple Choice

Diminishing marginal returns occur when:

• A) each additional unit of a variable factor adds more to the total output than the previous unit.
• B) each additional unit of a variable factor adds less to the total output than the previous unit.
• C) the marginal product of a variable factor is increasing at a decreasing rate.
• D) the total product decreases.

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Definitions:

Market Price

The price at which goods and services are bought and sold in a competitive marketplace, reflecting supply and demand dynamics.

Price Ceiling

A price ceiling is a government-imposed limit on the price charged for a commodity, with the intention of keeping prices at an affordable level for consumers.

Team Structure

A structure that uses permanent and temporary cross-functional teams to improve lateral relations.

Sense Identification

The process of recognizing and understanding one's feelings, surroundings, or the current situation; often used in the context of personal or organizational development.