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Question

Identify the correct choices.


A

Spreading effect dominates at lower levels of output

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B

Diminishing returns dominates at lower levels of output

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C

Spreading effect dominates at higher levels of output

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D

Diminishing returns effect dominates at higher levels of output.

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Solution

The correct options are
A

Spreading effect dominates at lower levels of output


D

Diminishing returns effect dominates at higher levels of output.


Spreading effect dominates at lower levels of output and diminishing returns effect dominates at higher levels of output.


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