When do diminishing marginal returns occur?
(A) When some workers increase output but others decrease it.
(B) When extra workers will have to wait their turn to be productive.
(C) When the marginal product of labor increases as the number of workers increases.
(D) When additional workers increase total output at a decreasing rate.
Ans: (D) When additional workers increase total output at a decreasing rate.
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An example of the interaction term between two independent, continuous variables is
A) Yi = ?0 + ?1Xi + ?2Di + ?3(Xi × Di) + ui. B) Yi = ?0 + ?1X1i + ?2X2i + ui. C) Yi = ?0 + ?1D1i + ?2D2i + ?3 (D1i × D2i) + ui. D) Yi = ?0 + ?1X1i + ?2X2i + ?3(X1i × X2i) + ui.
The value of a basket of goods and services was $1,500 in 2010 and $1,800 in 2012 . If 2010 was the base year, the price index for the year 2012 was _____
a. 110 b. 200 c. 120 d. 100