Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

A production function identifies how various inputs can be combined and transformed into a final output. One important microeconomic principle from production theory is the

A production function identifies how various inputs can be combined and transformed into a final output. One important microeconomic principle from production theory is the law of diminishing marginal returns. This phenomenon is where totals output at first increases at an increasing rate but after some point increases at a decreasing rate with respect to a greater quantity of a variable input, holding all other inputs constant. Economists point to the fixed short-run inputs as a basis for diminishing productivity. Give one example of the law of diminishing returns in the health care industry

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

International economics

Authors: Robert J. Carbaugh

13th Edition

978-1439038949, 1439038945, 978-8131518823

More Books

Students also viewed these Economics questions