1. State the three stages of production?

8. Which of the following statements is an example of a Scale Effect? (A). The firm decides to increase output when wages fall because production costs fall. (B). The firm decides to increase output when the cost of capital increases because production costs have increased. (C). Companies decide to add workers when wages fall because workers are relatively cheaper than other factors of production. (D). The company decided to reduce workers when wages fell because workers became relatively more expensive than other factors of production. (E). All of the above answers are wrong. Choose one of the answers from the five choices provided. And please, also provide a brief description, explanation or argument for your choice. Thank you Bartleby!

1. In the short run, an increase in output at low levels of production will most likely cause:   A. an increase in the marginal cost due to the rising total fixed cost.   B. an increase in the marginal cost due to the law of diminishing returns.   C. a decrease in the marginal cost due to economies from greater specialization.

Figure 2-4 50 45 40 25 35 30 28 25 20 15 10 5 V Z 10 20 30 40 50 60 70 80 opak Refer to Figure 2-4 Suppose this economy is producing at point W. Which of the following statements would best explain this situation? a) The economy lacks the resources to produce at a more desirable point. b) The economy's available technology prevents it from producing at a more desirable point. c) There is widespread unemployment in the economy. d) Any of the above statements would be a legitimate explanation for this situation.