- Question 8 Suppose Guy S Gizmo Company Currently Faces The Short Run Production Function Q 300l Where Q Is Output And L 1 (181.83 KiB) Viewed 58 times
Question 8 Suppose Guy's Gizmo Company currently faces the short-run production function q=300L, where q is output and L is labor; L is the only input that varies in the short-run. This short-run production function does not “make sense" relative to the more common S-shaped production function because: O as Guy's uses increasing amounts of L, it never experiences gains to specialization O regardless chi how much labor Guy's uses, it never faces decreasing marginal produce of labor. regardless of how much output Guy's produces, its marginal cost never decreases. regardless of how much output Guy's produces, its average variable cost never changes as long as the price of L remains unchanged. O Each of the preceding statements is correct.