8 Questions
What does production in economics refer to?
Transformation of inputs into outputs
What does the Law of Variable Proportions/Law of Diminishing Returns state?
When one factor is increased keeping others fixed, the marginal and average product eventually declines
What happens to the marginal and average product as per the Law of Variable Proportions?
They eventually decline when one factor is increased
According to the Law of Variable Proportions, what happens when one factor is increased while keeping others fixed?
The marginal and average product eventually declines
How is the Law of Variable Proportions also known?
Law of Diminishing Returns
What does production in economics refer to?
Transformation of inputs into outputs
What happens to the output when the quantities of a variable factor are increased to a fixed factor?
Increase in output to a point beyond which it eventually declines
How many stages are there in the Law of Variable Proportions?
Three stages
Test your knowledge of the theory of production with this quiz. Explore the concept of transforming inputs into outputs and the impact of the law of variable proportions on production. Evaluate your understanding of how factors like raw materials and labor influence the overall production process.
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