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ch4aika [34]
3 years ago
5

If a 10 percent increase in both capital and labor causes output to increase by less than 10 percent, the production function is

said to exhibit decreasing returns to scale. If it causes output to increase by more than 10 percent, the production function is said to exhibit increasing returns to scale. Why might a production function exhibit decreasing or increasing returns to scale?
Business
1 answer:
olasank [31]3 years ago
3 0

Answer:

Because of economies and diseconomies of scale.

Explanation:

Increasing returns to scale refers to the situation when a proportionate change in input leads to more than proportionate change in output. This may happen because of economies of scale.  

Economies of scale are said to happen when the average cost of production decreases with the increase in the volume of output.  

Decreasing returns to scale refers to the situation when a proportionate change in input leads to less than proportionate change in output. This may happen because of diseconomies of scale.  

Diseconomies of scale occur when a firm experiences an increase in the average total cost as the volume of output increases.

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ram.asked me not to stand

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2 years ago
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1. In each of the following situations, identify which of the twelve principles is at work
aleksklad [387]

Answer:

a. The true cost of something in its cost of opportunity

Explanation:

Opportunity cost is the cost which is defined as the cost or expense of one item which is lost in order to get the opportunity to do or to consume something else. In simple words, it is the value or the cost of the next best available alternative.

So, when the person select to bought the textbooks through Chegg instead paying the higher price for the same books through the bookstore. Under this situation, the principle applies is the cost of something in its opportunity cost.

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2 years ago
Shamrock Company had the following information available at the end of 2014.
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Answer and Explanation:

The preparation is presented below:      

                                                Shamrock Company

                                            Statement of Cash Flows

                                 For the Year Ended December 31, 2014

                                                  (Direct Method)

Cash flows from operating activities

Cash receipts:  

Cash received from customers $1,153,660  

Dividends received                 $2,500

Total cash receipts                         $1,156,160

Cash payments:  

Cash paid to suppliers                  $762,690  

Cash paid for operating expenses $225,230  

Taxes paid                                     $39,920  

Interest paid                                       $61,776

Total cash payments                           -$1,089,616

Net cash provided by operating activities  $66,544

Cash flows from investing activities  

Sale of short-term investments $14,080  

Sale of land $55,590  

Purchase of equipment -$124,570  

Net cash used by investing activities  -$54,900

Cash flows from financing activities  

Proceeds from issuance of common stock $29,526  

Principal payment on long-term debt -$9,580  

Dividends paid -$23,890  

Net cash used by financing activities  -$3,944

Net increase in cash  $7,700

Cash, January 1, 2014  $3,060

Cash, December 31, 2014  $10,760

Working notes

Sales Revenue $1,160,450  

– Increase in Accounts Receivable $6,790  

Cash received from customers $1,153,660  

Cost of Goods Sold $748,980  

+ Increase in Inventory $5,020  

+ Decrease in Accounts Payable $8,690  

Cash paid to suppliers $762,690  

Operating Expenses $275,640  

– Depreciation/Amortization Expense -$39,330  

– Decrease in Prepaid Rent -$110,80  

+ Increase in Prepaid Insurance $1,640  

+ Increase in Office Supplies $520  

– Increase in Wages Payable -$2,160  

Cash paid for Operating Expenses $225,230  

Income tax expense $40,350  

Less:Increase in income taxes payable -$430  

Taxes paid $39,920  

Interest Expense $52,270  

+ Decrease in Bond Premium $9,506  

Interest paid $61,776  

Reconciliation of Net Income to Net Cash Provided by Operating Activities:  

Net income  $58,420

Adjustments made to reconcile net income to net cash provided by operating activities:  

Add: Depreciation expense $39,330  

Add: Decrease in prepaid rent $110,80  

Add: Increase in income taxes payable $430  

Add: Increase in wages payable $2,160  

Less: Increase in accounts receivable -$6,790  

Less: Increase in inventory -$5,020  

Less: Increase in prepaid insurance -$1,640  

Less: Increase in office supplies -$520  

Less: Decrease in accounts payable -$8,690  

Less: Gain on sale of land -$8,320  

Less: Gain on sale of short-term investments -$4,390  

Less: Amortization of bond premium -$9,506  

Total adjustments  $8,124

Net cash provided by operating activities  $66,544

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Lake City enacts an ordinance that bans the distribu-tion of all printed materials on city streets. Mackensie opposes the city's
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Answer:

c. ​unconstitutional under the First Amendment.

Explanation:

Under the first amendment the act of banning such printed materials is unconstitutional. As it is not good for people in the country to witness such things.

As printed material includes books, magazines, and other things which enhance the knowledge level of different people.

Therefore, banning printed material will make the country people short of knowledgeable resources.

Therefore, the court will announce it unconstitutional.

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3 years ago
econ One year a country has negative net exports. The next year it still has negative net exports and imports have risen more th
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Answer:

its trade deficit rose

Explanation:

Trade deficit occurs when the imports of a country are higher than the exports. It is called the trade deficit. It means the country is importing more value of goods from other countries and exporting less. When Imports grows higher than the growth in exports, the trade deficit eventually rises.

8 0
3 years ago
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