General Robotics uses only labour and capital as inputs. Suppose General Robotics'budget for production of gadgets decreased by 20%, causing the company to produce20% less gadgets. What effect would this development have on this company'sdemand for labour?O A. 100% scale effect; demand for labour would increase.O B. 100% scale effect; demand for labour would decrease.O C. 100% substitution effect; demand for labour would decrease.O D. 100% substitution effect; demand for labour would increase.

In a market, producer's decision related to input resources is influenced by two effects that are…

Answered: General Robotics uses only labour and…

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter11: The Firm: Production And Costs

Section: Chapter Questions

Problem 8P

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Please complete the following statement. When isoquants are convex a. the marginal rate of technical substitution rises as the quantity of labour increases. O b. none of the other options. O c. labor, but not capital, is subject to the law of diminishing marginal returns. O d. the marginal rate of technical substitution falls as the quantity of labour increases. O e. as labour increases and capital decreases, both the marginal product of capital and labour decrease.
The figure shows the total product curve for different levels of a variable input, labor. O In the figure, marginal product of labor becomes negative beyond point A O C O B Output E Total Product curve A B C DE Quantity of Labor
Which of the following statements is not correct? Select one: O a When MC is below AVC, AVC is rising. O b. The total product curve shows how a firm's output changes when the quantity of labour changes. O c. Diminishing marginal returns occur when the marginal product of a worker is less than the marginal product of the previous worker. O d. The change in total product resulting from a one-unit increase in the quantity of labour is called marginal product. ous page Next
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Q2
The Rocky Mountain Spring Water Company experiences a surge in orders, because the water of one of its major competitors is taken off the market due to news that samples contained benzene. As the Company struggles to increase production of its bottled water, it finds that the marginal product of labor, its only variable input, approaches zero. When the marginal product of labor becomes zero this month, the firm Select one: O a. will still be able to fill additional orders this month without hiring more workers. O b. won't be able to fill any additional orders this month. O c. will achieve maximum output per unit of labor. O d. will be able to fill additional orders this month by hiring more workers.
The slope of an isocost line is equal to the Select one: O a. O b. and is negative of the ratio of input prices; constant decreases as we move down the line; the ratio of the marginal products O c. is constant; the ratio of the marginal products O d. increases as we move down the line; the ratio of input prices
Suppose college graduates earn $25 an hour and high school graduates earn $5 an hour. Suppose too that the marginal product of college graduates at Johnson Tools is 8 hammers per hour, while the marginal product of high school graduates is 4 hammers per hour (regardless of the number of each type of worker employed). a. What is the least-cost production method for producing 100 hammers in an eight-hour day? O Hire one-third college graduates and two-thirds high school graduates. O Hire two-thirds college graduates and one-third high school graduates. Hire only high school graduates. Hire half college graduates and half high school graduates. O Hire only college graduates. b. What if the marginal product of high school graduates was instead 2? O Hire half college graduates and half high school graduates. Hire only high school graduates. O Hire two-thirds college graduates and one-third high school graduates. O Hire only college graduates. O Hire one-third college graduates and…
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In the Cost Minimization Problem, the isoquant curve for an output level equal to the output quota? Illustrates the cost of labor and capital a firm pays to produce a level of output in excess of an output quota. Illustrates all combinations of labor and capital that a firm cannot afford. Illustrates all combinations of labor and capital that a firm can afford. O Illustrates all combinations of labor and capital that a firm can use to produce a level of output equal to the output quota.
The short run is defined as the period of time: Select one: O a. in which all inputs are fixed O b. in which at least one input is fixed O c. O d. none of the answers provided is correct in which no inputs are fixed
Productivity decreases when O a. Output and hours worked decrease at the same rate O b. Hours worked decreases at a faster rate than output O c. Hours worked decreases at a slower rate than output Od. The cost per unit produced decreases

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