Figure 12-3
-Refer to Figure 12-3.Which of the following statements best captures the nature of the underlying production function (not pictured)?
A) Output increases at a decreasing rate with additional units of input.
B) Output increases at an increasing rate with additional units of input.
C) Output decreases at a decreasing rate with additional units of input.
D) Output decreases at an increasing rate with additional units of input.

Question

Figure 12-3 
-Refer to Figure 12-3.Which of the following statements best captures the nature of the underlying production function (not pictured)?
A) Output increases at a decreasing rate with additional units of input. 
B) Output increases at an increasing rate with additional units of input. 
C) Output decreases at a decreasing rate with additional units of input. 
D) Output decreases at an increasing rate with additional units of input.

Quizplus · Accepted Answer

The statement suggests diminishing returns, where each additional unit of input contributes less to output than the previous unit, indicating output increases at a decreasing rate.

Figure 12-3 -Refer to Figure 12-3.Which of the Following Statements Best Captures