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.
Question
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.
Solution
The scenario that best illustrates the operation of the Law of Variable Proportions is: "A factory adds more workers to a production line and output increases, but at a decreasing rate."
Here's why:
The Law of Variable Proportions states that as more of one input variable (like labor) is added to a fixed amount of another input variable (like machinery or land), the marginal product of the variable input will eventually decline.
In the given scenario, the factory is adding more workers (variable input) to a production line (fixed input). Initially, the output increases which could be due to more manpower leading to more production. However, after a certain point, the output increases at a decreasing rate. This could be due to overcrowding, limited machinery, or inefficiencies that come with managing a larger workforce. This perfectly demonstrates the Law of Variable Proportions.
Similar Questions
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
How does the Law of Variable Proportions help a firm in its production decision? It helps in understanding how to increase the scale of production. It helps in understanding how to minimize cost by utilizing resources optimally. It helps in understanding how to diversify the product line. It helps in understanding how to introduce new technology.
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
Which stage of the Law of Variable Proportions is inefficient for production?First stageSecond stageThird stageFourth stage
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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