Show that increasing returns to scale can co-exist with diminishing marginal productivity
What will be an ideal response?
The production function below illustrates this point. Diminishing marginal productivity describes what happens to output when only labor increases; returns to scale describes what happens to output when both capital and labor increase.
The first three rows illustrate diminishing marginal returns. Comparing rows 1 and 4 shows increasing returns to scale.
Economics
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What would be the effect of an increase in the European Money Supply in the Dollar Euro Exchange Rate?
What will be an ideal response?
Economics
There is a tendency for inflation rates to fall in countries that use inflation targeting
a. True b. False Indicate whether the statement is true or false
Economics