Explain the law of diminishing returns. How does it relate to the cost of labor?
Answer to relevant QuestionsWhat would be American Airlines' marginal cost of adding a passenger to its Boeing 747 flight from Minneapolis to Seattle, assuming seats are available? Explain. What do economists mean by downsizing? Compose another table that shows AFC, AVC, ATC, and MC drawn from the data in practice problem 1, then graph each. Explain how the Boston Celtics of the NBA can use the MR = MC rule to decide whether to sign a college superstar to a first-year $10 million contract. Monopolists can choose to produce at any price along its demand curve, but that option does not exist for firms in perfect competition. Explain.
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