Post Utme Noun 2020 Economics Question 2

Practice objective / multiple choice question 2 from the 2020 Post Utme Noun Economics examination.

Post Utme Noun 2020 Economics Objective / Multiple Choice
Question 2 POST_UTME_NOUN • 2020 • ECONOMICS • objective

A firm is considering two different production techno\logies: one that uses a lot of labor and another that uses a lot of capital. If the firm's production function is characterized by decrea\sing returns to scale, what will be the effect on the firm's output if it increases the amount of labor used?

Answer Options

A. The output will increase
Correct Answer B. The output will decrease
C. The output will remain unchanged
D. The effect on the output is uncertain
Correct Answer
B
Correct Option:
The output will decrease

About This Question

This is Post Utme Noun 2020 Economics Question 2. It is one of the objective questions from the 2020 Post Utme Noun Economics examination.

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