The Minimum Efficient Scale for a Firm Is the

question 161

Multiple Choice

The minimum efficient scale for a firm is the

• A)lowest rate of output at which long-run average cost is at a minimum
• B)lowest rate of output at which short-run average total cost is at a minimum
• C)lowest rate of output at which short-run average variable cost is at a minimum
• D)average of the rates of output at which long-run average cost is at a minimum
• E)average of the rates of output at which short-run average total cost is at a minimum

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Definitions:

Option Agreement

An agreement that gives a party the option, but not the obligation, to buy or sell an asset at a predetermined price and date.

Buy-and-Sell Agreement

A legally binding agreement between co-owners that outlines the procedure for the redistribution of shares of a departing owner, often used in partnerships and close corporations.

Transfer Restriction

Legal limitations placed on the transferability of securities or other assets, which may require certain conditions to be met before transfer can occur.

Fiduciary Agreement

A legal or ethical relationship of trust between two or more parties, typically where one party agrees to act in the best interests of another.