Economics Practice Test – Theory of Production (Questions with Answers and Explanations)

In the production process, the law of diminishing returns begins to set when ______ (JAMB 2018)

A. all inputs are variables
B. last variable input results to decrease in total product
C. last variable input adds less in relation to the previous variable input
D. All inputs are fixed

Calculate the value of V. (JAMB 2015)

In the process of production, total output is at maximum when ______ (JAMB 2011)

A. MP > 0   B. AP = 0   C. AP > 0    D. MP = 0

If a firm doubles all inputs in the long run and the output is less than doubled, this results in _____ (JAMB 2012)

A. diminishing returns
B. constant returns to scale
C. increasing returns to scale
D. decreasing returns to scale

From the diagram above, the optimal point of production is ______ (JAMB 2011)