1) Use the graph to answer the question. Between points C and D, the long-run average total cost curve is characterized by ________ because the firm is experiencing ________ returns to scale. A-constant returns; constant. B-economies of scale; increasing. C-economies of scale; constant D-diseconomies of scale; increasing. E-diseconomies of scale; decreasing
(1) Use the graph to answer the question.
Between points C and D, the long-run
A-constant returns; constant. B-economies of scale; increasing. C-economies of scale; constant
D-diseconomies of scale; increasing. E-diseconomies of scale; decreasing
The graph is attached on the following
(2) If a firm is operating at a point on its long-run average total cost curve where the slope is negative, it is
A-experiencing increasing returns to scale. B-experiencing constant returns to scale
C-experiencing decreasing returns to scale. D-achieving efficient scale. E-making progressively less as it increases its inputs
(3) If a firm is maximizing its profit and is earning positive economic profit, which of the following must be true?
A-Average total cost <
B-Average total cost > price; marginal cost = marginal revenue
C-Average total cost < average revenue; marginal cost > marginal revenue
D-Total cost > total revenue; marginal cost > marginal revenue
E-Total cost = total revenue; marginal cost > marginal revenue
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