Economics 2150A/B Study Guide - Final Guide: Budget Constraint, Isoquant, Engel Curve
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ECON 2150A/B Full Course Notes
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London canada: stirling economics 2150a 003 november, 2012. Diminishing marginal returns occur when the total product function is decreasing. increasing at a decreasing rate. increasing at a constant rate. increasing at an increasing rate. decreasing at an increasing rate. If capital cannot easily be substituted for labour, then the elasticity of substitution is. Suppose over time that a firm"s production process undergoes capital-saving technological progress. With a linear production function, the mrtsl,k declines as the firm substitutes labour for capital. is diminishing. implies upward-sloping, straight-line isoquants. is undefined. remains constant as the firm substitutes labour for capital. The good would not enter the utility function. The income effect works in the opposite direction to the substitution effect. There is only a substitution effect from a price change. We can infer that the consumer"s income elasticity for good good. Version 111: identify the truthfulness of the following statements.