Economic Science

Lesson 6: The Production of Wealth

Your name:

Please read Part III, Chapters 1 - 6

1. What is production, in political economy? Are transportation and exchange part of production? (III,1)



2. Name and define the three modes of production, in the order that they naturally arise. (III,2)



3. Why did George place so much stress in correcting the mistake expressed in "the alleged law of diminishing returns in agriculture"? What was the mistake? (III,3)



4. Why is it necessary to consider the meanings of space and time in political economy? (III,4)



5. a) What kind of relation is space? 



b) What kind of relation is time? (III,4)



6. What fallacy as to the nature of land has persisted among economists? (III,5)



7. a) Explain why there are diminishing returns beyond a point of maximum productivity in all forms of production. 



b) Illustrate the law of diminishing returns with an example from some form of production. (III,5) 



8. How is the principle of diminishing returns used to make profit-maximixing decisions? (III,5)



9. Is there a law of diminishing returns in time as well as in space? Illustrate. (III,6)



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