If an Industry Is a Constant-Cost Industry

question 249

Multiple Choice

If an industry is a constant-cost industry

• A)prices of its inputs increase even though output remains constant
• B)it uses inputs at higher levels of output
• C)prices of its inputs rise at a constant rate as it uses more inputs
• D)prices of its inputs remain constant as the number of firms increases
• E)firms in the industry experience economies of scale

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Definitions:

Customer Specifications

Customer specifications are the detailed descriptions or requirements given by a customer regarding how a product or service should be delivered or executed.

Process Cost Systems

An accounting system used to track and assign production costs to units of output in industries where products are uniformly produced.

Industries

Broad categories of business activities focused on the production or supply of goods, services, technology, or information.

Process Costing System

An accounting system used to assess the costs associated with each stage of the manufacturing process, especially applicable in industries producing homogenous products.