The Following Figure Shows the Long-Run Average Cost Curve of a Firm

question 24

Multiple Choice

The following figure shows the long-run average cost curve of a firm.
Figure 6-1

-Refer to Figure 6-1.The production function of the firm displays constant returns to scale when output is increased from _____.

• A)0A to 0E
• B)0C to 0D
• C)0D to 0E
• D)0A to 0B
• E)0B to 0D

---

Definitions:

Bargain Purchase

An acquisition where the purchase price is significantly less than the fair value of the net identifiable assets of the acquired company.

Deferred Tax Liability

A tax obligation that arises from temporary differences between the accounting and tax treatment of assets and liabilities which is expected to be settled in the future.

Shareholders' Equity

The residual interest in the assets of a corporation after deducting its liabilities, also known as stockholders' equity or owner's equity.

Recoverable Amount

The higher value between an asset's fair value less costs to sell and its value in use.