Michelles business produces ceramic cups using labor, clay, and a kiln. She can manufacture 25 cups a
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Michelle’s business produces ceramic cups using labor, clay, and a kiln. She can manufacture 25 cups a day with one worker and 35 cups with two workers. Does her production process illustrate diminishing returns to scale or diminishing marginal returns to scale? Give a plausible explanation for why output does not increase proportionately with the number of workers.
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Related Book For
Microeconomics Theory And Applications With Calculus
ISBN: 9780133019933
3rd Edition
Authors: Jeffrey M. Perloff
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