Which one of the following best defines the Law of Variable Proportions? Output decreases as all inputs increase. Output increases as one input is increased, holding all other inputs constant. Output increases as all inputs increase. Output decreases as one input is increased, holding all other inputs constant.
Question
Which one of the following best defines the Law of Variable Proportions? Output decreases as all inputs increase. Output increases as one input is increased, holding all other inputs constant. Output increases as all inputs increase. Output decreases as one input is increased, holding all other inputs constant.
Solution
The Law of Variable Proportions is best defined as: Output increases as one input is increased, holding all other inputs constant. This law states that if the quantity of one factor of production is increased while other factors are held constant, the overall output will increase, but after a certain point, the rate of increase in output will start to decline. This is due to the fact that the increased input is not being matched by a proportional increase in other inputs.
Similar Questions
Law of variable proportion is valid when ________________.a.Only one input is fixed and all other inputs are kept variableb.All factors are kept constantc.All inputs are varied in the same proportiond.Only one input is variable and all other inputs are kept fixed
Which one of the following scenarios best illustrates the operation of the Law of Variable Proportions? A baker increases the amount of flour used in a recipe while keeping the amount of yeast constant, and the bread rises more. A farmer uses more fertilizer on his fields and gets a larger crop yield. A factory adds more workers to a production line and output increases, but at a decreasing rate. A restaurant adds more chefs to the kitchen and the number of meals prepared per hour remains the same.
Which of the following is a true statement about the Law of Variable Proportions?It assumes that all units of the variable input are heterogeneous.It is applicable only in the long run.It is applicable only to the agriculture sector.It operates in the short run when at least one factor of production is fixed
How is the Law of Variable Proportions different from the Law of Returns to Scale?The former applies to the long run while the latter applies to the short run.The former deals with variable proportions while the latter deals with fixed proportions.The former assumes that one input is kept constant while the latter assumes that all inputs are varied.The former assumes that all inputs are varied while the latter assumes that one input is kept constant
What is the primary reason for the operation of the Law of Variable Proportions? The presence of fixed and variable inputs in the short run. The presence of only variable inputs in the long run. The absence of fixed inputs in the short run. The absence of variable inputs in the long run.
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