A Firm Used to Produce a Product Using Three Units

question 137

Multiple Choice

A firm used to produce a product using three units of labor and one unit of capital. The firm discovers that it can produce more output at a lower cost if it combines two units of labor with two units of capital. This is an example of

• A) an innovation.
• B) an invention.
• C) increasing returns.
• D) economic growth.

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Definitions:

Steel Sample

A piece or specimen of steel, often used for testing or analysis to determine its composition or mechanical properties.

Density

A physical property indicating how much space an object or quantity of substance occupies in relation to its mass.

Precision

Precision refers to the closeness of two or more measurements to each other, indicating the reproducibility of a measurement.

Density of Water

The mass per unit volume of water, approximately 1 gram per cubic centimeter (1 g/cm³) at standard temperature and pressure.