Consider the Following Statements When Answering This Question

question 126

Multiple Choice

Consider the following statements when answering this question.
I. A technology with increasing returns to scale will generate a long-run average cost curve that has economies of scale.
II. Diminishing returns determines the slope of the short-run marginal cost curve, whereas returns to scale determine the slope of the long-run marginal cost curve.

• A) I is true, and II is false.
• B) I is false, and II is true.
• C) Both I and II are true.
• D) Both I and II are false.

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Definitions:

Assets

Assets are resources owned or controlled by a business, expected to bring future economic benefits.

Total Assets

The sum of all resources owned by a company, valued at cost, which are expected to provide future economic benefits.

Bank

A financial institution licensed to receive deposits, offer loans, and provide other financial services.