Question 6 of 136. How might an industry's costs change in the long run?a. Costsmaydecrease due toconstant returns to scale.economies of scale.diseconomies of scale.O re-economies of scale.b. Costs may increase becausean expanding industry bids up resource or input costs.profits can only be made in the long run.in the long run, price is always equal to average total cost.a39°FA D36 constant returns to scale.economies of scale.diseconomies of scale.O re-economies of scale.b. Costs may increase becausean expanding industry bids up resource or input costs.O profits can only be made in the long run.in the long run, price is always equal to average total cost.an expanding industry bids down resource or input costs.a(36

In popular usage, cost refers to the monetary worth of goods and services purchased by producers and…

Question b of 13 6. How might an industry's costs change in the long run? a. Costs may decrease due to constant returns to scale. economies of scale. diseconomies of scale. re-economies of scale. b. Costs may increase because an expanding industry bids up resource or input costs. profits can only be made in the long run. in the long run, price is always equal to average total cost.

Question b of 13 6. How might an industry's costs change in the long run? a. Costs may decrease due to constant returns to scale. economies of scale. diseconomies of scale. re-economies of scale. b. Costs may increase because an expanding industry bids up resource or input costs. profits can only be made in the long run. in the long run, price is always equal to average total cost.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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1. Every firm will have a U-shaped cost curve in the short-run because a. Every firm faces resource limitations b. Every firm faces rising capital costs during an economic recession c. Of the law of diminishing marginal returns d. Of labor unions
The vertical distance between ATC and AVC as output expands is aa. marginal costb. total fixed costc. average fixed cost d. economic profit per unitPlease, show your answer graphically.
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I. A company produces at an output level where marginal cost is equal to marginal revenue and has the following revenue and cost levels: Total revenue = $1,450 Total cost = $1,500 Total variable cost = $1,300 What would you suggest? a. Shut down. b. Continue to produce because the loss is less than the total fixed cost. c. Increase production to lower the marginal cost. e. Raise the price. II. At current long-run production levels, the marginal revenue of a competitive firm is $15 and the marginal cost of the firm is $15. If the market is perfectly competitive, the firm should a. cut back on production. b. stop production all together. c. produce more. d. continue producing at current levels.
15. If the long-run average total cost is increasing as the output increases we call this: a. economies of scale b. diseconomies of scale c. constant returns to scale d. specialization
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2. Find the volumes over which each site for making a product is the lowest cost. Site Fixed Variable 1 20,000 18 2 10,000 32,000 23 166 4. 35,000 20 a) What is the highest volume where site 2 is the lowest cost? b) What is the lowest volume where site 3 is the lowest cost?
ips Under decreasing returns to scale, average cost cost curve. as the quantity produced increases. Over this range of output, the marginal cost curve is Grade It Now the average Save & Continue
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