Fred's Franks originally sold hotdogs and soft drinks from a cart located in front of City Hall. Then Fred purchased another hotdog cart and hired someone to sell hotdogs and soft drinks near the high school. Both locations have been successful. When Fred's Franks expanded to two locations, which of the following did NOT occur?
A) Fred's production function changed.
B) Production increased.
C) The company increased the inputs it employs.
D) The firm employed additional capital.

Question

Quizplus · Accepted Answer

Fred's production function did not change; it remained the same, but the scale of operations increased with more inputs and capital.

Fred's Franks Originally Sold Hotdogs and Soft Drinks from a Cart