The law of diminishing returns indicates that: a. as extra units of a variable resource are added to a fixed resource the marginal product will decline beyond some point. b. because of economies and diseconomies of scale a competitive firm's long-run average cost curve will be U-shaped. c. the demand for goods produced by purely competitive industries is downsloping. d. beyond some point the extra utility derived from additional units of a product will yield the consumer smaller and smaller extra amounts of satisfaction.
The law of diminishing returns indicates that: a. as extra units of a variable resource are added to a fixed resource the marginal product will decline beyond some point. b. because of economies and diseconomies of scale a competitive firm's long-run average cost curve will be U-shaped. c. the demand for goods produced by purely competitive industries is downsloping. d. beyond some point the extra utility derived from additional units of a product will yield the consumer smaller and smaller extra amounts of satisfaction.
Chapter10: Cost Functions
Section: Chapter Questions
Problem 10.4P
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The law of diminishing returns indicates that:
a. as extra units of a variable resource are added to a fixed resource the marginal product will decline beyond some point.
b. because of economies and diseconomies of scale a competitive firm's long-run average cost curve will be U-shaped.
c. the demand for goods produced by purely competitive industries is downsloping.
d. beyond some point the extra
Why do marginal costs tend to rise, and marginal benefits tend to fall?
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