The Leontief Paradox

question 56

Multiple Choice

The Leontief paradox:

• A) Was applied to the product life cycle theory
• B) Suggested that the U.S.exports labor-intensive goods
• C) Found that national income differences underlie world trade patterns
• D) Implied that diseconomies of scale occur at low output levels

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Definitions:

Profit-Maximizing Output

The level of production at which a company achieves the highest possible profit margin, given its costs and market demand.

Wage Rate

The amount of money paid to an employee per unit of time, which can be hourly, daily, or annually.

Total Product

The overall amount of products made by a company within a specific timeframe.

Marginal Product

The additional output produced by using one more unit of a variable input, holding other inputs constant.