Question 1) Give an example of a product which experiences the law of diminishing marginal productivity. At what point would a firm stop production on such a product?
Give an example of economies of scale in industry. What is the implication of economies of scale for new entrants into an industry?
Give an example of diseconomies of scale in industry. What is a possible solution to the diseconomies of scale problem?
Question 2) Have you ever belonged to a labor union in your occupation? If so, how did union membership affect your job security and wages? If not, how did a lack of union membership affect your working conditions and salary negotiations?
Give an example from your personal experience, or that of someone you know, of corporate downsizing. What were the factors that led the firm to downsize its employees? How did you or the person you know find new employment?