Question: Marjorie Cplus wrote the following answer on her micro examination: Virtually every production function exhibits diminishing returns to scale because my professor said that all

Marjorie Cplus wrote the following answer on her micro examination: "Virtually every production function exhibits diminishing returns to scale because my professor said that all inputs have diminishing marginal productivities. So when all inputs are doubled, output must be less than double." How would you grade Marjorie's answer?

Step by Step Solution

★★★★★

3.41 Rating (167 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock

The students argument is not correct in all the cases because the dimini... View full answer

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Document Format (1 attachment)

1046-B-E-D-A-S (3400).docx

120 KBs Word File

Students Have Also Explored These Related Economics Questions!

The production function for a firm is given by Q = LK, where Q denotes output; Land K labor and capital inputs. Wage rate and rental rate are given by w and r respectively. (a) Show whether or not...

Multiple Choice Questions: 1. Which of the following is always true? a. When marginal cost is less than average total cost, average total cost is increasing. b. When average fixed cost is falling,...

Multiple Choice Questions 1. The law of diminishing marginal utility implies that the more of a commodity you consume, the a. More you value additional units of output. b. Less you value additional...

1. Roy Dingbat is the manager of a hot dog stand that uses only labor and capital to produce hot dogs. The firm usually produces 1,000 hot dogs a day with 5 workers and 4 grills. One day a worker is...

Marjorie Cplus wrote the following answer on her micro examination: Virtually every production function exhibits diminishing returns to scale because my professor said that all inputs have...

Question # 1 : Majeda wrote the following answer on her microeconomics examination: "Virtually every production function exhibit diminishing returns to scale because my professor said that all inputs...

Intermediate Micro Economic questions 2. A student wrote on the last year Econl exam the following: " Every production function exhibits diminishing returns to scale because professor said that all...

Intermediate Microeconomics Question 2. A student wrote on the last year Econl exam the following: " Every production function exhibits diminishing returns to scale because professor said that all...

5. A student wrote on the last year Econ 301 exam the following: \" Every production function exhibits diminishing returns to scale because professor said that all inputs have diminishing marginal...

Write a short note on Bhopal Disaster 1984.

A bungee jumper having a mass of 55 kg leaps from a bridge, braking her fall with a long elastic shock cord having axial rigidity EA = 2.3 kN (see figure). If the jumpoff point is 60 m above the...

Why are international investors especially concerned about the real interest rate as opposed to the nominal rate?

Suppose now that at retirement, Social Security will start paying benefits each year equal to 60% of this consumers earnings during her last working year. Assume that benefits are not taxed. How much...

Find the pure-strategy Nash equilibrium or equilibria of the following game with three actions for eachplayer. Left Center Right Up 4, 3 5,1 6, 2 A Middle 2,7,4 3,6 Down 3, 0 9, 6 0, 8

How will Mrs. Smith's supply-of-labor curve shift if her inheritance increases to $20 per day? Graph both supply curves to illustrate this shift.

A ready-to-eat cereal manufacturer faces two types of consumers, adults and children, having the following schedule of gross surpluses for each additional unit of cereal consumed. Cereal costs $0.15...

Calculate the present value for the following assuming that the money can be invested at 14% percent. (Round final answers to the nearest dollar amount.) a. You may receive $71,000 immediately. b....

eBook The Holmes Company's currently outstanding bonds tave a 94 coupon and a 14% yield to maturity. Holmes believes it could issue new bonds at par that would provide a similar yield to maturity. If...

eBook Problem Walk - Through n investor has two bonds in his portfolio that have a face value of $ 1 , 0 0 0 and pay a 9 % annual coupon. Bond L matures in 1 1 years, while Bond S matures in 1 year....