Which situation describes the increasing returns stage of the production function?

• Hiring one more baker results in less than one oven available per baker.

• Hiring one more tailor results in three more suits produced per hour.

• Buying one more office computer causes there to be more computers than workers.

• Extending the workday results in more tired and less productive workers.

If all inputs are increased in the same proportion, then it is a case of ___________.

(i) Short run production function

(ii) Long run production function

(iii) Laws of variable proportions

(iv) Laws of returns to scale

• (i) & (ii) only

• (ii) & (iii) only

• (i) & (iv) only

• (ii) & (iv) only

In a production process, the input combination has 30 per cent of fixed assets, 40 per cent raw material and 10 per cent labour. The quantity of all other inputs, except fixed assets has been doubled. The production process would be subjected to _______________.

• Law of Variable Proportions

• Returns to Scale

• Decreasing Returns

• Increasing Returns

First stage of law of variable proportion ranges from origin till the point where ___________.

• AP is maximum

• MP is maximum

• TP is maximum

Under which time period does the Law of Returns to Scale apply?

• Very Short period

• Short period

• Long Period

• Very Long period

When more and more units of a variable factor are combined with the fixed factor, the resulting law is called ____________.

• Law of Variable Proportions

• Returns to Scale

• Law of Increasing Returns to Scale

• Diminishing Returns

Negative returns in the short run imply that

• Average product is negative

• Total product is negative

• Marginal product is negative

• Total cost is falling

The table shows the total output that Bart’s Beans produces with differing amounts of labor. At what quantity of labor does diminishing returns to labor set in?

• At the 8th unit of labour

• At the 4th unit of labour

• At the 5th unit of labour

• At the 9th unit of labour

The table below shows the output associated with different amounts of labor for the firm .

What is the marginal product of the 25th unit of labour?

• 6

• 4

• 55.2

• 25

Which of the following is not a factor of production?

• Capital

• Materials

• Money

• Labour