Economics students often confuse (a) diminishing returns related to the variable factors of production and (b) diseconomies of scale. Explain the difference between the two and give one example of each.

Economics students often confuse (a) diminishing returns related to the variable factors of production and (b) diseconomies of scale. Explain the difference between the two and give one example of each.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Factors of Production

Factors of production – in simple words means the factors that are used for producing any product or service. This includes the resources which are necessary for the manufacturing of products. Factors of production are also known as the building blocks of the economy.

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