16. Consider the production process undertaken by a firm. Which of the following would imply that the firm operates in the long run? a) The firm cannot find new workers quickly. b) The firm requires a lot of time to install new machines at the factory. c) The firm can obtain new factors of production as fast as it desires, without any constraint. d) The firm can not buy new real estate to establish a new factory. 17. Assume that the level of capital is fixed, and more workers are added to the production process. It is observed that the marginal product of the last worker eventually falls. This is referred to as: a) Diminishing marginal utility c) Crowding out b) Law of diminishing marginal returns d) Decreasing returns to scale
16. Consider the production process undertaken by a firm. Which of the following would imply that the firm operates in the long run? a) The firm cannot find new workers quickly. b) The firm requires a lot of time to install new machines at the factory. c) The firm can obtain new factors of production as fast as it desires, without any constraint. d) The firm can not buy new real estate to establish a new factory. 17. Assume that the level of capital is fixed, and more workers are added to the production process. It is observed that the marginal product of the last worker eventually falls. This is referred to as: a) Diminishing marginal utility c) Crowding out b) Law of diminishing marginal returns d) Decreasing returns to scale
Chapter9: Production Functions
Section: Chapter Questions
Problem 9.3P
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please answer the both questions 16,17!!
Transcribed Image Text:16. Consider the production process undertaken by a firm. Which of the following would
imply that the firm operates in the long run?
a) The firm cannot find new workers quickly.
b) The firm requires a lot of time to install new machines at the factory.
c) The firm can obtain new factors of production as fast as it desires, without any constraint.
d) The firm can not buy new real estate to establish a new factory.
17. Assume that the level of capital is fixed, and more workers are added to the production
process. It is observed that the marginal product of the last worker eventually falls. This is
referred to as:
a) Diminishing marginal utility
c) Crowding out
b) Law of diminishing marginal returns
d) Decreasing returns to scale
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