AGEC 271 exam 1 questions and
answers graded A+
Total Product - correct answer ✔✔output, yield, quantity
simply dependent variable/the independent variable - correct answer ✔✔Average relations
Marginal relations - correct answer ✔✔change in dependent variable caused by a change in the
independent variable
Input - correct answer ✔✔a resource used in production of output
ex. fertilizer
Output - correct answer ✔✔the result (yield) from the production process
ex. the good that the farmer sells
The concept of diminishing marginal returns. When land is fixed, why can't we just keep adding
more and more inputs and get more outputs? - correct answer ✔✔As the quantity of an input
increases with the quantities of all other inputs are held constant, the resulting change in
output eventually diminishes. There is only a specific amount that can be produced on a fixed
amount can be produced on a fixed amount of land before it eventually cannot produce any
more and you are wasting money by adding inputs.
Decision Rules - correct answer ✔✔1. MR=MC profit maximizing output
2. MVP=MIC profit maximizing input
answers graded A+
Total Product - correct answer ✔✔output, yield, quantity
simply dependent variable/the independent variable - correct answer ✔✔Average relations
Marginal relations - correct answer ✔✔change in dependent variable caused by a change in the
independent variable
Input - correct answer ✔✔a resource used in production of output
ex. fertilizer
Output - correct answer ✔✔the result (yield) from the production process
ex. the good that the farmer sells
The concept of diminishing marginal returns. When land is fixed, why can't we just keep adding
more and more inputs and get more outputs? - correct answer ✔✔As the quantity of an input
increases with the quantities of all other inputs are held constant, the resulting change in
output eventually diminishes. There is only a specific amount that can be produced on a fixed
amount can be produced on a fixed amount of land before it eventually cannot produce any
more and you are wasting money by adding inputs.
Decision Rules - correct answer ✔✔1. MR=MC profit maximizing output
2. MVP=MIC profit maximizing input
